EInd last week, the crypto mixer Tornado Cash was hit by a major hack. The hacker submitted a proposal for a change in policy. But it was a rogue proposal and he managed to get himself 1.2 million votes. That was well above the 700,000 legitimate votes, leaving him practically single-handedly ruling protocol. But now the grassroots has regained control of the mixer with a new proposal.
Tornado Cash recovered after attack
Shortly after the attack, news broke that the attacker voluntarily wanted to reverse the hack by returning the tokens. However, it was not entirely clear whether this was really the case. It was also not clear what the hacker’s motives were, according to some it was no more than a joke.
The hacker went to a remarkable amount of effort for something that was nothing more than a joke, so he would even have tried to cover his tracks via Tornado Cash. As a result, he managed to sell many TORN tokens for around $890,000 worth of ethereum (ETH). He also managed to capture many of the tokens that were already tied up in the governance contract.
Now it’s settled – the hack was only temporary and the original community is now back in control. On May 26, a new proposal adopted, with 517,000 votes in favor and zero against. This should allow the original tokenholders to regain their influence. Fortunately, the protocol itself has not changed after the hack.
Tornado Cash has become illegal
Tornado Cash hasn’t had much positive news in recent months. In August of 2022, the United States government announced that it is illegal for United States residents to use the mixer. The service would be used by criminals to launder money. This would even allow the North Korean government to pay for its nuclear weapons program.
The service became almost unusable soon after. One of the developers happens to live in the Netherlands, but he was arrested because he is suspected of enabling money laundering. He can now sit out the trial at home.