Kevin O’Leary says sacrificing Tornado Cash worth it for institutional adoption

by Abiodun Oladokun
7 ways to make with crypto

Mr. Wonderful thinks that crypto needs more regulation and less “crypto cowboys” like Tornado Cash creator Alexey Pertsev, who he suggested was a necessary sacrifice to create stability for institutional inflows.

Kevin O’Leary says sacrificing Tornado Cash worth it for institutional adoption

Clamping down on crypto applications that “mess with the primal forces of regulation” is necessary, says Shark Tank host and millionaire venture capitalist Kevin O’Leary, who argued that Tornado Cash and similar services are preventing real institutional capital from coming into the space.

In a discussion on Crypto Banter on Saturday, O’Leary, also known as Mr. Wonderful, suggested that applications like Ethereum-based crypto mixer Tornado Cash are a part of a “crypto cowboy” culture that shouldn’t have a place in the industry.

Instead, O’Leary is of the view that crypto needs a “rules-based environment” in order to attract real institutional capital into the digital-asset industry, and much of that regulation needs to stamp out protocols like Tornado Cash, which enables users to conduct anonymous transactions and therefore potentially engage in criminal activity.

In the discussion, O’Leary didn’t back down on his opinion regarding the arrest of the Tornado Cash creator Alexey Pertsev, stating:

Chainlink Lead Developer Advocate Patrick Collins also said that the decision to remove Tornado Cash’s GitHub account is “much worse than sanctioning a website” as code is speech and by doing so the U.S. Treasury is violating the first amendment of the U.S. Constitution.

Ethereum educator Anthony Sassano shared in a Tweet to his 218,000 followers that he was temporarily banned from decentralized finance (DeFi) lending protocol AAVE, after his address was blacklisted for recieving 0.1 Ether (ETH) from an anonymous person via Tornado Cash. Sassano went on to note that the “main conclusion I have come to from recent events is that Ethereum is more of a concern to governments/nation states than Bitcoin.”

Related: Tornado Cash co-founder reports being kicked off GitHub as industry reacts to sanctions

Last week, Dutch financial crime authority the Fiscal Information and Investigation Service (FIOD), arrested a 29-year-old Tornado Cash developer who was suspected to be involved in money laundering via the protocol.

According to a Dutch regulatory body, over $7 billion have flowed through Tornado Cash’s smart contracts since its inception in 2019. The sanctions from the U.S. Treasury came after more claims that the protocol had increasingly been used for money laundering activities.

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