U.S. Court Sides With Tornado Cash and Overturns Sanctions, Says Smart Contracts ‘Not Property’
A U.S. appeals court has ruled that the Treasury Department’s sanctions against the crypto mixer Tornado Cash were unlawful and an overreach of authority.
In 2022, The Office of Foreign Assets Control’s (OFAC) sanctioned Tornado Cash – which allows users to obfuscate and anonymize their crypto transactions on the Ethereum (ETH) network – under allegations that it was allowing North Korean agents to launder stolen funds.
Its developers have been targeted with lengthy legal proceedings and the threat of prison time ever since.
Now, a New Orleans-based U.S. Court of Appeals for the Fifth Circuit led by Judge Don Willett wrote that the OFAC’s sanctions failed to correctly define “property” in its statute against the service.
Judge Willet says that under the International Emergency Economic Powers Act, the President is permitted to “block… any property in which any foreign country or a national thereof has any interest.”
However, Willet says that if the definition of “property” is something that is “capable of being owned,” then Tornado Cash and its immutable smart contracts can’t qualify as such, making the sanctions unlawful.
The Judge also notes that since Tornado Cash’s smart contracts are “unchangeable and unremovable,” they remain available for anyone – including North Korean wrongdoers – to continue using despite sanctions.
Says Willet,
“More importantly, Tornado Cash, as defined by OFAC, does not own the services provided by the immutable smart contracts. A homeowner may own the right to trash-removal services and a client may own the right to legal services performed by a lawyer, but neither the homeowner nor the client owns the person performing the trash-removal services or the lawyer—for good reason. Similarly, Tornado Cash as an “entity” does not own the immutable smart contracts, separate and apart from any rights or benefits of the services performed by the immutable smart contracts.
Contrary to the Department’s arguments, the immutable smart contracts are not services. So even when we consider OFAC’s regulatory definitions, the immutable smart contracts are not property because they are not ownable, not contracts, and not services.”
TORN, Tornado Cash’s utility token, rallied almost 900% on the ruling.
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HashKey Group Advances Blockchain in Global Finance
Stablecoin market cap hits new ATH after more than 2 years
The global stablecoin market capitalization reached an unprecedented $190 billion in November, surpassing the previous all-time high of $188 billion set in April 2022, according to a recent CCData report.
The sector experienced a robust 9.94% growth from October, marking the highest month-on-month increase since November 2021.
This milestone also represents the 14th consecutive month of end-of-month market cap growth, reflecting sustained global demand for stablecoins as an integral part of the digital finance ecosystem.
USDT leads growth
TetherUSD (USDT) remains the dominant force, recording a 10.5% increase in market capitalization to reach $133 billion. This marks the 15th consecutive monthly rise for the stablecoin, which now accounts for 69.9% of the sector.
Similarly, Circle’s USD Coin (USDC) also posted significant growth, climbing 12.1% to $38.9 billion, the highest level since February 2023.
Meanwhile, Ethena Labs’ USDe stood out with a 42.2% rise to a new all-time high of $3.86 billion, driven by the mid-month activation of revenue-sharing mechanisms for ENA token holders.
In contrast, First Digital USD (FDUSD) and Sky Dollar (USDS) experienced declines in market capitalization, falling 14.9% and 8.34%, respectively.
The report revealed that 38 of the 198 stablecoins analyzed reached new all-time highs in November, signaling a diverse and competitive market. While USDT, USDC, and USDe were among the largest contributors to the sector’s growth, some stablecoins faced challenges.
Additionally, Euro-denominated stablecoins are emerging as an area of innovation and compliance, positioning Europe as a potential leader in the next phase of stablecoin adoption.
However, Euro-pegged stablecoins experienced an 11.4% drop in market cap, falling to $256 million despite several positive developments in the region in recent weeks.
Trading volume near record highs
Stablecoin trading volumes on centralized exchanges soared in November, increasing 77.5% month-on-month to $1.81 trillion as of Nov. 25.
The surge puts trading activity on track to surpass March’s yearly record, buoyed by growing institutional interest and optimism over regulatory clarity in the US. Analysts attribute the uptick to heightened confidence in stablecoins as reliable assets for trading and hedging within a volatile crypto market.
USDT dominated trading activity, accounting for 82.7% of all volume across centralized exchanges, while FDUSD ranked as the second most traded stablecoin with a 9.01% market share, followed by USDC at 8.09%.
According to the report, FDUSD’s dominance reflects its strong adoption in Asian markets, particularly in cross-border payment applications.
Meanwhile, euro-denominated stablecoins saw a significant 52.9% surge in trading activity to $657 million during the month, indicating increased adoption among European users.
Analysts suggest that while market cap reductions may reflect short-term consolidation, the rising trading activity signals steady progress in building utility and compliance under the MiCA framework.
Optimistic outlook
As stablecoins continue to evolve, their role as the backbone of crypto trading and settlement has become increasingly evident. With over $1.81 trillion in monthly trading volume and rising institutional confidence, stablecoins are poised for sustained growth.
Regulatory clarity in the US and Europe is expected to further legitimize the asset class, encouraging broader adoption across industries. As stablecoins diversify into new use cases like cross-border payments and yield-generating mechanisms, the sector is set to play a pivotal role in shaping the future of digital finance.
The post Stablecoin market cap hits new ATH after more than 2 years appeared first on CryptoSlate.
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