I think the regulators will simply go after any exchanges that deal with Tornado Cash, rather than Tornado Cash itself. This just causes a new kind of cat and mouse game to happen while the money laundering industry greases their palms.
To be honest, with the incoming Trump administration’s cryptocurrency-friendly views and the likelihood they will turn a blind eye to outright scamming, I think it will only be a matter of time before something huge really cleans the majority of folks out in the biggest rugpull of all time.
I can’t possibly know when that will happen if it does. But this speedrunning the wild-cat bank situation from ages ago is probably going to be interesting to watch unfold.
Ease of washing crypto is a big win for Russia and NK.
Without these tumblers crypto changes hands, is traced to Russia and accomplices are on the hook for jail time. So you really don't want to do it. With these washers it's totally safe, do it and take your cut. It's a direct way around sanctions and it fuels violence and oppresion.
1) That is a direct argument against anything that is a global good. If we do something that is good for everyone, bad people will benefit from it because they are people too. Bad people benefiting doesn't, in isolation, tell us anything about whether something is a good idea.
2) Money being hard to trace is a bigger problem for authoritarian regimes than it is a help. Places like Russia, China, etc, rely fairly heavily on financial controls to stop people sending money to places with the most reliable legal system. If you live in a world where the tax offices can't track money, authoritarians will struggle more than anyone else to raise funds.
2) depends on the country, and imo is largely an outdated view. NK for example has undeniably seen enormous benefits from cryptos, much more than any potential drawbacks. China has such extensive societal level tracking and tracing in place aleady that even crypto tumblers are unlikely to have a significant impact on the amount of money the government fails to track.
https://www.ca5.uscourts.gov/opinions/pub/23/23-50669-CV0.pd... (opinion, pdf)
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