The Ethereum Foundation announced it would support the legal defense of Alexey Pertsev, co-founder of Tornado Cash. The Foundation will set aside $1.25M for the task while stating general support for privacy.
The Ethereum Foundation will support on-chain privacy and will pay $1.25M toward the legal defense of Aleksey Pertsev. The co-founder of Tornado Cash recently swapped his prison containment with electronic monitoring and announced he would prepare a legal case to regain his freedom.
Pertsev is still fighting his case in the Netherlands and will use the donation to prepare his appeal.
Tornado Cash remains one of the key mixers, which is still permissionless and has been used by hackers and other bad actors. However, the Ethereum Foundation has stated its full support for privacy and Pertsev’s case that his code was not intended to cover up digital crimes.
“Privacy is normal, and writing code is not a crime,” wrote Vitalik Buterin as a comment to the Foundation’s efforts.
So far, the fundraiser has collected 186.25 ETH, most coming from small donors with 0.1 ETH inflows. The decision follows a previous donation of $1.25M for the defense of the other Tornado Cash co-founder, known as Roman Storm. Once again, the campaign was driven by the idea that prosecutors should not hold developers liable if their technology is used by bad actors.
So far, crypto privacy has taken a step back when confronted by regulators. Privacy coins have been shunned by exchanges unless their origins are unveiled. Transactions from Tornado Cash addresses or wallets exposed to the mixer have also been refused.
Buterin and the Ethereum Foundation have promoted the Railgun mixer, which verifies the origin of funds before mixing and does not allow for blacklisted addresses. Confidentiality may still be key as known wallets are closely watched for transfers or purchases, which can sway the crypto market.
Tornado Cash slowly returns
Tornado Cash is still in use, mostly to mix ETH, with some BNB and DAI activity. The mixer is the main source to obscure and gain privacy for the Lazarus group of hackers, who switch most assets to ETH. In the past month, inflows to the mixer inched up by 2.3%, though the mixer still has a big net outflow of funds in the past six months.
However, Tornado Cash is not enough to obscure funds, especially because it taints any related addresses. For that reason, hackers have also used additional trades, including NFT and meme tokens.
The Tornado Cash mixer had its OFAC sanctions lifted for US users on January 22. The mixer is yet to regain its traffic, as US-based traders found other solutions since 2022, when Tornado Cash was first sanctioned.
Ethereum Foundation changes leadership
The Ethereum Foundation is shifting its leadership in a drive to clarify its focus and goals. Aya Miyaguchi was recently promoted from the Foundation’s executive director position, and will take up the role of president.
Miyaguchi retains the long-term mandate of the foundation despite calls for short-term interventions to salvage the tanking of ETH price.
Today, I’m excited to turn the page and share that I will be closing this chapter as Executive Director of the @ethereumfndn soon and stepping into a new role as its President.
Let’s continue building in the garden.
Read my full statement :https://t.co/sn3Rpsatqy https://t.co/4Gz3WdLPLD
— Aya Miyaguchi (@AyaMiyagotchi) February 25, 2025
The Ethereum Foundation has never taken a hands-on approach to shill ETH and has faced criticism for simply spending from its treasury. Miyaguchi reiterated that the foundation would be led based on its principles, with a mostly hands-off approach. The foundation will still oversee a mixed ecosystem, including core developers, L2 teams, and various smaller communities.
Miyaguchi also stated Ethereum would not compete like a corporation. However, it will continue to run Devcon, unite communities, and win by following its core principles.
The shift in leadership happened right after ETH suffered the effects of the Bybit hack, crashing to a lower tier under $2,400. Since then, ETH recovered to $2,428.22, as the markets still showed signs of weakness.
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