Dutch law enforcement authorities have arrested a developer suspected of laundering money through the dubious crypto mixer Tornado Cash.
The so-called Fiscal Information and Investigation Service (FIOD), the Dutch authority for the fight against financial crime, announced on Friday that it has arrested a 29-year-old man in Amsterdam.
The man is said to have helped Tornado Cash move and launder criminal funds via the Ethereum mixer, as the authority indicates.
The FIOD also points out that there could be further arrests in the case, because the authority’s Financial Advanced Cyber Team (FACT) only launched an investigation into Tornado Cash in June 2022.
According to FACT, Tornado Cash is mainly used to conceal illegal money flows on a large scale, including funds from crypto hacks and crypto fraud projects.
“This includes money stolen by a hacker group that is believed to be linked to the government of North Korea. Tornado Cash was founded in 2019 and has already generated sales of at least $ 7 billion since then, “ according to the published statement.
The new announcement comes a few days after the American tax office imposed several sanctions against the crypto service provider. As a result, the major stablecoin operator USD Coin has also frozen 75,000 USDC, which are located in wallets that are on the ministry’s blacklist.
Due to the sanctions, it is now forbidden for all American citizens to use the smart contracts of Tornado Cash. Intentional violations can result in penalties of $ 50,000 to $ 10,000,000 or imprisonment for 10 to 30 years.
The Ethereum-based crypto mixer Tornado Cash is used to blur blockchain transaction data and thus provide more anonymity. However, such services are often misused for illegal purposes.