Fiscal Information and Investigation Service (FIOD) of the Netherlands said it arrested a 29-year-old man in Amsterdam on suspicion of "concealing criminal financial flows" and "facilitating money laundering" through crypto mixing service Tornado Cash
The suspect is brought before the examining judge and "multiple arrests are not ruled out," the FIOD
reported, this week, Tornado Cash was placed by the US government on the OFAC sanctions list.
The FIOD added that this service and the Financial Advanced Cyber Team (FACT) started a criminal investigation against Tornado Cash this past June.
"It is suspected that persons behind this organization have made large-scale profits," the FIOD added.
Tornado Cash is a virtual currency mixer that operates on the blockchain and facilitates anonymous transactions by obfuscating their origin, destination, and counterparties, thus increasing privacy of its users. Tornado mixes transactions before transmitting them to their individual recipients.
The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) that Tornado Cash has been used to launder more than USD 7bn worth of virtual currency since its creation in 2019.
Meanwhile, US-based blockchain analysis company Chainalysis that, since becoming active in August 2019, Tornado Cash has received over USD 7.6bn worth of ETH, "a sizable portion of which have come from illicit or high-risk sources."
Per their report,
"Half of those funds came from DeFi protocols, but 18% came from sanctioned entities (almost entirely, we should note, before those entities were sanctioned), while just under 11% were funds stolen from other cryptocurrency services and protocols."
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