On Thursday, the cryptocurrency world was shaken by the news when Dropbit CEO Larry Harmon and Coin Ninja were arrested on charges of laundering about $311 million from Alphabay, a darknet marketplace using coin mixing tools.

Tumblers or Coin mixers were legally employed by bitcoin owners to combine their transactions with other users transactions, offering onchain privacy degree that<a href="https://www.cryptoknowmics.com/tag/bitcoin/"> Bitcoin</a> do not offer by default. Criminals could also use mixers for similar purposes. This has prompted the US Justice Department to bring a law to criminalize the use of such on-chain privacy tools.
<h2>More Transparency Is Required From Justice Department</h2>
On Thursday, the Assistant Attorney of Justice Department, General Brian Benczkowski<a href="https://www.justice.gov/opa/pr/ohio-resident-charged-operating-darknet-based-bitcoin-mixer-which-laundered-over-300-million"> cited</a> this indictment emphasized that attempting to obscure cryptocurrency transactions in such a way [via a mixer]was a crime. The day before in testimony before the Senate Finance Committee, Steven Mnuchin, the U.S. Treasury Secretary cited they needed to ensure that these digital currencies were not used as an alternative to secret bank accounts.

He further added that they were functioning with FinCEN, and they would introduce new regulations to achieve more transparency so that law enforcement could monitor where the wealth was going and that this was not used to launder money.
<h2>Criminalizing The Human Desire Of Privacy</h2>
It remained to be resolved whether the Helix mixer of Harmon was intentionally complicit in laundering money to darknet drug; the service closed in 2017, the very year when Alphabay came to an end. Whatever the case, it appeared that a chilling precedent was made in criminalizing the inherent human urge for privacy. If "looking to cover<a href="https://www.cryptoknowmics.com/news/"> cryptocurrency</a> transactions" was a crime, as the Department of Justice claimed, what other methods of privacy could be banned? Was making use of noncustodial mixers like Samourai's Whirlpool or implementation of Coinjoin for Wasabi Wallet illegal?

US Justice Department Is Criminalizing OnChain Privacy

The Assistant Attorney of Justice Department, General Brian Benczkowski cited indictment of attempting to obscure cryptocurrency transactions was a crime.

Shailesh is an ardent follower of the crypto world and keenly watches every development taking place in the cryptocurrency space. He loves to voice his opinions through well-curated blogs and articles, which throw light on different facets of the crypto industry.

US Justice Department Is Criminalizing OnChain Privacy

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