The Background of the Case

In a bold legal move, six individuals have stepped up to challenge the U.S. Treasury’s decision to sanction crypto mixer Tornado Cash. On May 24, these plaintiffs filed a motion arguing that their case isn’t about special treatment for cutting-edge technology, but rather a clear instance of government overreach and a direct violation of their First Amendment rights. Led by Coinbase’s chief legal officer, Paul Grewal, the case has attracted significant attention since its inception on September 8, 2022.

Argument One: Misclassification of Tornado Cash

The first argument revolves around the Treasury’s effort to classify Tornado Cash as a foreign “national.” To impose sanctions, they had to label it as an unincorporated association, which the plaintiffs fiercely contest. They point out that the Treasury’s definition wrongly includes all holders of the TORN token, irrespective of whether they act collectively. This contradicts the Treasury’s own criteria for classification.

Argument Two: Ownership and Property Laws

The second argument dives into the heart of property laws, asserting that sanctions can only block assets deemed as property. The plaintiffs uniquely highlight that the open-source, immutable smart contracts that enable Tornado Cash functionality can’t be owned or controlled by anyone. The lawyers might as well argue that trying to own a cloud is nonsense.

Argument Three: Lack of Authority

Even if we momentarily entertain the idea that these smart contracts could be viewed as property, the plaintiffs state that no single entity associated with Tornado Cash possesses any tangible interest in them. Thus, the Treasury’s attempts to impose sanctions appear just as effective as trying to catch smoke with your bare hands.

Argument Four: First Amendment Violations

Finally, the plaintiffs claim that if the Treasury does indeed have the authority to impose these sanctions, they still violate the First Amendment. They argue that suggesting Tornado Cash users should simply shift their discussions elsewhere is not a valid defense. After all, it would be akin to telling someone their right to free speech doesn’t matter as long as they speak in hushed tones!

Conclusion: The Fight for Privacy in the Digital Age

The plaintiffs behind this lawsuit aren’t just seeking to defend Tornado Cash; they’re drawing a line in the sand regarding digital rights and freedoms. As the legal implications of cryptocurrency continue to unfold, this case could ignite a significant precedent about the treatment of technology and privacy in the eyes of the government. It’s a good reminder: even in the realm of code and contracts, the fundamental principles of rights and freedoms must prevail.