Federal Court Permanently Bars U.S. Treasury from Reimposing Tornado Cash Sanctions

A federal court has delivered a decisive victory for cryptocurrency privacy advocates by permanently prohibiting the U.S. Treasury from reinstating sanctions on Tornado Cash. Judge Robert Pitman ruled the Treasury’s actions unlawful, issuing a final injunction against enforcement. The decision upholds the Fifth Circuit’s earlier stance that smart contracts do not qualify as sanctionable property.

The ruling dismantles the government’s argument that voluntary delisting in March rendered the case moot. This legal precedent strengthens protections for decentralized finance tools, reinforcing the boundary between code and culpability. Privacy-focused protocols now operate with clearer regulatory guidance amid ongoing debates about financial surveillance in crypto markets.