Crypto is failing where digital yuan may succeed

DOES an industrial-sized dog whistle go off when advocates boast about cryptocurrency’s ability to evade US government sanctions?

Back in March, a founder of Tornado Cash — a so-called “mixer” service that masks cryptocurrency transactions by mixing them with others — told Bloomberg it would be “technically impossible” for sanctions to be enforced against decentralised protocols. Surprise: Tornado has now been sanctioned by the US Treasury’s Office of Foreign Assets Control, partly because of its use by hackers said to be linked to North Korean money laundering.

With Tornado down 95 per cent from its all-time high and its source code removed from Microsoft Corp’s GitHub, it’s the latest blow to the “no sanctions yay” theory of crypto — the three words used by former Ethereum Foundation scientist Virgil Griffith in 2019 when he told a blockchain conference in North Korea how to dodge sanctions by converting cash into crypto, costly advice that resulted in a guilty plea and a 63-month federal prison sentence.