Federal Appeals Court Tosses OFAC Sanctions on Tornado Cash and Limits Federal Government’s Ability to Police Crypto Transactions

On November 26, 2024, the United States Court of Appeals for the Fifth Circuit issued a landmark decision holding that the Treasury Department’s Office of Foreign Assets Control (“OFAC”) exceeded its statutory authority by sanctioning immutable smart contracts created by Tornado Cash. While the decision leaves several legal issues open and is still subject to appeal by the Treasury Department, it has significant implications for the use of the International Emergency Economic Powers Act…
By: Mayer Brown