- The sanctioning of Tornado Cash has reduced global mixer usage, according to Chainalysis
- Chief scientist Jacon Illum attributed a recent drop to the blacklisting of the service
- No obvious contenders are ready to take its place
Chainalysis’ chief scientist Jacon Illum has said that the categorisation of Tornado Cash as a sanctioned entity has resulted in a drop in mixer service usage worldwide. Illum told Cointelegraph recently that the banning of Tornado Cash has left a vacuum for illicit fund mixing services, but which ones will fill it, if any, are not yet known.
Criminal Fraternity is Watching and Waiting
Illum was speaking during a demonstration of Chainalysis’ recently launched blockchain analysis platform Storyline, where questions naturally turned to Tornado Cash. Illum said whilst some are still using it, it was not yet possible to establish a new trend and that more time was needed to “see what’s happening”:
People are getting more cautious in the space and are not sure how to interact with Tornado Cash, we’ve seen deposits into services providing similar activity go down at least temporarily, because people are measuring like ‘what does this mean for me?’
Illum says that while there is no obvious heir to Tornado Cash’s throne, a crop of “junior mixers” have sprung up looking to cash in on the void that Tornado Cash left. Data from Chainalysis shows that the 30-day average of the total daily value received by crypto mixers reached a new all-time high of $51.8 million in April, four months before Tornado Cash was banned in the U.S.
Chainalysis Monitoring Situation
Chainalysis’ Country manager for Australia and New Zealand Todd Lenfield added that the situation was being carefully monitored by the likes of Chainalysis:
The hunting for places where there is liquidity, when it’s highly visible after things like the OFAC sanctioning of Tornado Cash, I think makes a very interesting space to keep an eye on.
It will be also interesting to see whether illicit activity drops as a result of there being fewer ways for criminals to launder their cash.