Tornado Cash

What Is Tornado Cash (TORN)?

Tornado Cash, represented by the TORN token, is a project designed to address privacy and anonymity concerns within the cryptocurrency space, particularly focusing on the traceability of transactions. The project originated as Tornado Cash v1 in August 2019, initially serving as an experimental software before evolving into a fully decentralized non-custodial protocol that facilitates private transactions on the Ethereum network.

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Recent Video Interview

Main points of the interview:

• Tornado Cash's role in online anonymity, privacy protection, and challenges with centralized systems.
• The risks of centralized subscription models for tracking transactions and potential privacy breaches.
• Advocated against bans on privacy technologies, citing their essential role in protecting individual freedoms and preventing illegal activities.

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Key Features of Tornado Cash

Decentralized Mixer Mechanism: Tornado Cash employs smart contracts on the Ethereum network, disrupting the on-chain link between sender and recipient addresses. This decentralized mixer mechanism ensures that transactions are private and immutable, providing users with the highest level of privacy.

Open Source and Non-Custodial: Tornado Cash is an open-source and non-custodial cryptographic engine operating on Ethereum Virtual Machine compatible networks. Users have full autonomy to propose and decide on adjustments to the protocol, making it a decentralized platform.

Unique Smart Contract Mixer: Tornado Cash utilizes standard ERC-20 smart contracts for each transaction, allowing users to deposit cryptocurrency with one address and withdraw from another without establishing a traceable link between the two addresses.

Zero Knowledge Proof Technology: To enhance privacy and security, the protocol incorporates Zero Knowledge Proof (ZKP) technology for user authentication without the need for an exchange password. This makes it difficult for third parties to access user information.

Permissionless and Trustless Operation: Tornado Cash is entirely permissionless and operates with self-executable code. The destruction of admin keys in May 2020 ensures that developers have no oversight over transactions, emphasizing financial privacy as crucial to freedom.

Smart Contract Promotion: Tornado Cash promotes smart contracts to facilitate ETH deposits and withdrawals from multiple addresses, making it challenging to identify the sender. The protocol also includes tools to selectively reveal deposits and prove users' transaction history.

Privacy Enhancement through Liquidity Pools: Withdrawals are facilitated through Tornado protocol liquidity pools, adding an extra layer of privacy to the sender's identity.

Criticism and Challenges

Despite its emphasis on privacy, Tornado Cash has faced accusations of being a tool for money laundering, attracting sanctions from the US Government. Critics argue that large deposits and low liquidity may potentially allow tracking of transactions.

What Is TORN Token?

TORN serves as the governance token for Tornado Cash on the Ethereum platform. As a decentralized platform, any proposed changes to the protocol are subject to community voting by TORN token holders. The more TORN a user possesses, the more influential their voice is in shaping the development of the protocol.

How Is The Tornado Cash Network Secured?

The Tornado Cash network is secured by zero-knowledge proofs, providing an additional layer of security to users. The protocol, along with the anonymity mining protocol, has undergone audits by professional audit companies such as Zeropool, ensuring the reliability and robustness of the platform.

Team Background

Roman Semenov, a co-founder of Tornado Cash, holds a degree in Quantum Statistics and Field Theory from Moscow State University. After his academic pursuits, he entered the realms of e-commerce and social media, founding two companies in these domains. His crypto journey began in 2017 when he assumed the role of Chief Software Architect at a foundation focused on Ethereum scalability. In 2018, he established PepperSec, a white hat hacker security consultant agency, which eventually paved the way for the creation of Tornado Cash.

On the other hand, Roman Storm, another co-founder, boasts an extensive background in the tech, blockchain, and software sectors. He previously worked as a Software Engineer at Amazon and Marketron, and later served as the Chief Technology Officer at the POA Network. Additionally, Storm held the position of Blockchain Developer for Blockchainlabz. Alongside Semenov, they co-founded PepperSec and initiated the development of Tornado Cash.

Project Development

In August 2023, Tornado Cash developers, Roman Storm and Roman Semenov, faced serious allegations of money laundering and sanctions violations. The Department of Justice (DOJ) arrested Storm, accusing him and Semenov of facilitating over $1 billion in money laundering transactions through their privacy mixer service. The mixer, designed to obscure the origin of crypto transactions, had previously been sanctioned by the U.S. Treasury Department's Office of Foreign Asset Control due to suspicions that it facilitated funds laundering for North Korea's Lazarus Group.

Semenov, along with eight Ethereum addresses under his control, was also sanctioned. U.S. Attorney Damien Williams stated that Tornado Cash knowingly facilitated money laundering, emphasizing the legal consequences. Storm's attorney, Brian Klein of Waymaker LLP, expressed disappointment, highlighting the case's reliance on a "novel legal theory" and asserting Storm's cooperation with the investigation.

Tornado Cash Price Analysis

As of November 25 2024 Tornado Cash has a marketcap of $13M. This is {{percentagefromath}} from its all time high of $436.16. In terms of its tokenomics, there's a total supply of 10M with 38% currently outstanding. Keep in mind Tornado Cash has a fully diluted value of $35M which many investors might interpret as overvalued.

Of course, don’t trust price predictions alone, always check the Coinrotator token screener to follow the trending market.