How the most-used crypto mixer works, why OFAC banned it, and what it means for your wallet.
Tornado Cash was a smart contract on Ethereum that mixed transactions — breaking the link between sender and receiver. Before it was sanctioned, it processed over $7 billion in crypto. A significant portion of that came from hackers, ransomware operators, and North Korean state actors.
Standard Ethereum transactions are fully public — anyone can trace who sent what to whom. Tornado Cash broke that trail in three steps:
You deposit exactly 0.1, 1, 10, or 100 ETH into the Tornado contract. It gives you a cryptographic "note" — a secret receipt.
You wait. The longer you wait, the harder the trail is to follow. Your deposit sits pooled with hundreds of others.
From a completely fresh wallet with no history, you submit your note. The contract releases the same denomination to your new wallet — with zero on-chain link to the deposit.
The U.S. Treasury's Office of Foreign Assets Control sanctioned Tornado Cash — not just its developers, but the smart contract addresses themselves. This was unprecedented: a piece of code placed on the SDN list.
If your wallet ever sent to or received from Tornado Cash — even once, even years ago — ClearChain will flag it. That interaction is permanently on-chain.
| Scenario | ClearChain result | Risk level |
|---|---|---|
| Wallet directly used Tornado Cash | Mixer interaction signal fires (+25 pts) | HIGH |
| Wallet received funds that passed through Tornado Cash | High-risk counterparty signal (+10 pts) | MEDIUM–HIGH |
| Wallet funded the Tornado Cash deployer address | OFAC SDN match (+40 pts) | CRITICAL |
| No interaction, no counterparty link | No signal fires | LOW |