More than $550 million worth of stolen cryptocurrency was laundered through Tornado Cash in 2024, according to a new report from Global Ledger. The cryptocurrency mixing service, which has been under scrutiny for its role in facilitating illicit transactions, received a total of 457,768 ETH—valued at approximately $1.64 billion at current market prices—between January 1 and November 27, 2024.
The report highlights that over 60% of the ETH deposits to Tornado Cash came from high-risk sources, including accounts linked to significant crypto hacks. A substantial portion—more than 56%—of the funds processed through the service originated from hacking incidents that took place in 2023 and 2024.
This marks a sharp increase from the previous year, when Tornado Cash handled 314,740 ETH in withdrawals. Among the largest contributors to this year’s laundered funds were several major hacks:
- WazirX Hack (July 2024): The largest contribution, with 61,698 ETH (approximately $217.2 million) funneled through Tornado Cash.
- Heco Bridge Hack (March 2024): The attacker laundered 52,281 ETH (around $189.1 million), originally stolen in 2023.
- Poloniex Breach: Hackers laundered 18,874 ETH ($68.4 million) via the service.
- Orbit Chain Exploit: This attack resulted in 12,930 ETH ($46.8 million) being washed through Tornado Cash.
- Penpie Exploit: 11,261 ETH ($40.8 million) was laundered from this hack.
Tornado Cash has faced legal and regulatory challenges in the past. The U.S. Treasury Department sanctioned the service in 2022, accusing it of enabling money laundering and facilitating the movement of over $7 billion in illicit funds since its launch in 2019. Notably, $455 million of these funds were linked to North Korea’s Lazarus Group.
A recent ruling by a U.S. court, however, has cleared Tornado Cash’s immutable smart contracts of sanctions, arguing that the Treasury overstepped its authority. This ruling has sparked concerns within the crypto community and among regulators, with the Global Ledger report warning that it could set a “dangerous precedent.” The decision may make it harder for regulators to tackle financial crime in the crypto space, potentially allowing bad actors to launder even larger sums of stolen cryptocurrency in the future.
The report also cautioned that the ruling could shake investor confidence, leading regulators to impose stricter rules that might burden legitimate businesses with increased scrutiny and tighter reporting obligations.
As Tornado Cash continues to facilitate illicit crypto transactions, the broader regulatory environment is likely to evolve, with governments and financial authorities grappling with the growing challenge of enforcing compliance within the rapidly changing crypto landscape.