The OKX Chief Operating Officer, Star Xu, has issued a warning to account holders regarding interactions with Tornado Cash (TORN). According to Xu, any engagement with the platform will result in a ban.

In a recent statement, Xu emphasized that users who have previously been sanctioned will not be allowed to open new accounts on OKX. Furthermore, the crypto exchange will close accounts of users making deposits from sanctioned entities such as Tornado Cash and Garantex.

θ’«εˆΆθ£ηš„δΊΊζ— ζ³•εœ¨okxζˆεŠŸεΌ€ζˆ·γ€‚

For existing account holders, the following actions will trigger compliance risk controls, leading to account termination:

  • Depositing funds from sanctioned entities like Garantex and Tornado Cash to OKX
  • Withdrawing funds from OKX to sanctioned entities

Xu assured that sanctions are not a concern for most users.

OKX is enforcing these measures to comply with global laws, aiming to limit the use of crypto mixers. Entities like Tornado Cash have been under scrutiny from regulators worldwide, who claim that these services are often used for illicit transactions. These tools are reportedly favored by international criminal networks and rogue states such as North Korea.

Tornado Cash was founded in 2019 by Russian nationals Roman Semenov, Alexey Pertsev, and Roman Storm. The entity specializes in anonymizing cryptography, using software to obfuscate the origins of cryptocurrencies deposited through the service. This process effectively redistributes funds into many small transactions, making them difficult to trace.

Labeled as a privacy coin, Tornado Cash has faced accusations of laundering stolen funds for international criminal organizations and indirectly funding North Korea’s nuclear program.

Recent security incidents have also impacted OKX’s reputation. In June, Blockchain security firm Slowmist uncovered a SIM swapping incident on the exchange, which resulted in at least two users losing funds due to a flaw in the two-factor authentication (2FA) system.

These security breaches have shaken confidence in OKX, and their latest efforts to ban Tornado Cash-related accounts seem to be a move to strengthen compliance with global regulatory laws.

Earlier this year, the United States House of Representatives proposed the Blockchain Integrity Act to ban crypto mixers for two years. Introduced by U.S. Representative Sean Casten, the bill aims to prohibit virtual asset service providers from accepting funds routed through mixers or allowing withdrawals directly to a mixer’s address. Breaching this rule could result in a civil penalty of up to $100,000.

The European Union has also taken a firm stance, voting in April to monitor non-custodial wallets while banning crypto mixers and privacy coins.

With regulatory headwinds pointing towards a potential ban on crypto mixers, entities like Tornado Cash and exchanges that list their tokens may soon find themselves categorized as part of the black market crypto sphere.

For more updates and news on cryptocurrencies, investing, and finance, stay tuned to Global Crypto News.

Post Views: 7