Tornado Cash Sanctions: Legal Arguments About Code, Associations, and Relayers

Summary

The brief challenges the US Treasury’s authority to sanction Tornado Cash, arguing that the protocol’s open-source code is not a person, entity, or property subject to sanctions. It disputes the claim that developers and TORN token holders formed an unincorporated association, on the grounds that they did not share an expressed intent to pursue a common purpose.

The brief also addresses OFAC’s argument that relayer fees paid to a DAO treasury imply a property interest in Tornado Cash’s smart contracts. It counters that relayers are optional, independently operated services, can be deployed by anyone using public code, and do not have to pay fees. This is an advocacy document describing one party’s legal position in ongoing litigation; it does not establish a court ruling or settle the questions it raises.

Key ideas

• The brief argues that open-source code does not itself meet the legal definition of a sanctionable person, entity, or property.
• It disputes that developers and token holders formed an unincorporated association because they did not express a shared purpose.
• It argues that optional, third-party relayers do not establish a property interest in the smart contracts.
• The document presents Paradigm’s legal arguments, not a final judicial determination.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.