Dutch authorities assume alleged developers of the crypto mixer Tornado Cash

The Dutch authorities for financial crime have arrested a man who is suspected of having participated in the development of Tornado Cash, the crypto mixing service, which was occupied by the United States due to alleged money laundering.

The arrest by the Fiscal Information and Investigation Service (FIOD) was announced on Friday, but the agency said it took place in Amsterdam on Wednesday. The 29-year-old is suspected of being involved in the disguise of criminal financial flows and the aid for money laundering by Tornado, it said.

The step of Fiod takes place only a few days after the US Ministry of Finance has imposed sanctions against crypto service, which increases the use in its efforts to act against crypto tools that can be used to avoid sanctions or commit comprehensive financial crimes.

At the beginning of this week, the US Ministry of Finance said that Tornado Cash was used to wash illegal funds worth more than $ 7 billion, including $ 455 million stolen by the Lazarus Group, a state-funded North Korean cyber criminal group.

The regulatory authorities focus on the role of so -called mixed services in cryptoma markets because they interrupt the payment paths, which are usually accessible via the digital main books on which the cryptocurrencies are based. Tornado is designed in such a way that it can be operated decentralized and without traditional corporate structure.

The Dutch agency said that it initiated a criminal investigation against Tornado Cash in June. Fiod said that his advanced cyber team for finance was suspected that the platform had been used to disguise "large-scale criminal flows of money", including funds that have been stolen by a "group that is believed to be connected to North Korea".

The Fiod added that several arrests were not excluded.

The problems of Tornado Cash mark a new front in the efforts of the global authorities, decentralized and improving the anonymity of technologies that are popular in the crypto industry.

In May, the US Ministry of Finance sanctioned another crypto mixing service called Blender.io, at that time the first company of its kind made by the Office of Foreign Assets Control under sanctions. The US government said that the crypto mixing service was used to process $ 20.5 million of illegal revenue.

"If you look at this mixing ability.

The hard procedure against mixers who increase anonymity has annoyed supporters of financial privacy.

"The fact that a technology could be used to violate the law does not mean that this technology is wrong. Criminals have long been using cash to commit crimes," said Marta Belcher, lawyer for cryptocurrency and civil freedom and special consultant at the Electronic Frontier Foundation.

What does the future look like for digital currencies? Our editor for digital financial news, Philip Stafford, and our correspondent for digital assets, Scott Chipolina, had a broad discussion on an Instagram livestream on this topic, including the effects of regulation and inflation on crypto. Watch it here .