US sanctions co-founder of Tornado Cash for laundering stolen cryptocurrency for N. Korea

The US Department of Treasury on Wednesday imposed sanctions on a co-founder of virtual currency mixer Tornado Cash for assisting a North Korean hacking group that has stolen hundreds of millions of dollars in cryptocurrency.

Roman Semenov is one of three co-founders of Tornado Cash, which was designated by the treasury department in 2022.

"Today, the US Department of the Treasury's Office of Foreign Assets Control sanctioned Roman Semenov, one of three co-founders of the sanctioned virtual currency mixer Tornado Cash, for his role in providing material support to Tornado Cash and to the Lazarus Group, a state-sponsored hacking group that is an instrumentality of the Democratic People's Republic of Korea," the department said in a press release, referring to North Korea by its official name.

"Tornado Cash has been used to launder funds for criminal actors since its creation in 2019, including to obfuscate hundreds of millions of dollars in virtual currency stolen by Lazarus Group hackers," it added.

Roman Storm, a second co-founder of Tornado Cash, was arrested by the Federal Bureau of Investigation earlier in the day, while Alexey Pertsev, the third co-founder of Tornado Cash, was arrested in the Netherlands in August 2022, according to the department.

"The Lazarus Group, which was sanctioned by the United States in 2019, used Tornado Cash to obfuscate the movement of over $455 million stolen in the March 2022 attack on Axie Infinity's Ronin network bridge, the largest known virtual currency heist to date," it said.

Tornado Cash continued to provide services to the Lazarus Group even after learning that the group was laundering hundreds of millions of dollars worth of stolen virtual currency through its mixing service, added the department, also noting that the stolen money "provides the DPRK with resources that it uses to support its unlawful ballistic missile and nuclear weapons programs." (Yonhap)