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Arbitrum DAO cancels proposal to fund Tornado Cash developers

Although the proposal has been dropped, backers still seek alternative support methods.

Arbitrum DAO cancels donation proposal for Tornado Cash developers

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Arbitrum DAO has withdrawn its recent proposal to donate up to $1.2 million to Tornado Cash developers Roman Storm and Alexey Pertsev, who are embroiled in legal battles, a source close to the matter confirmed to The Block. Last week, ImmutableLawyer, an Arbitrum contributor, proposed sending between 200,000 and 600,000 ARB, equivalent to $400,000 to $1.2 million, to aid the developers’ legal defense fund.

Storm and Pertsev are currently facing charges for their involvement in creating and developing Tornado Cash, a smart contract protocol that obfuscates crypto transactions on the Ethereum network. This has led to the protocol’s use in money laundering activities by criminals, drawing significant legal attention.

Despite the proposal’s withdrawal, supporters are exploring other avenues to provide financial assistance. One such method under consideration is channeling funds through Coin Center, a non-profit organization dedicated to crypto policy. The aim is to support WeWantJusticeDAO’s campaign to raise money to cover the developers’ legal costs, estimated at $100,000 per month.

The US Treasury sanctioned the crypto-mixing service Tornado Cash in August 2022 due to allegations of laundering cash for harmful cyber actors, including the Lazarus Group. The sanctions froze Tornado Cash’s assets, prohibited transactions to or from the service, and banned the mixer’s code.

The Treasury’s crackdown has raised concerns about privacy implications and potential future shutdowns of similar services. Some individuals have challenged these sanctions through a lawsuit funded by Coinbase against the US Treasury Department.

Additionally, on February 14, GoFundMe terminated a fundraising campaign intended to collect legal defense funds for Storm and Pertsev due to a breach of their terms of service.

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