He is one of the “martyrs” of the crypto community. Alexey Pertsev is the creator of Tornado Cash software, a cryptocurrency “mixer”. This program greatly complicates the traceability of a transaction on a public blockchain where all exchanges carried out in most cryptocurrencies are recorded, like the most famous of them, bitcoin. Originally, the tool solved a real puzzle: the lack of confidentiality of crypto transactions, which are often wrongly believed to be secret.
The problem is that cybercriminals have also used Tornado Cash’s services to conceal the origin of funds obtained illegally during hacks. Massively. Sums of several billion dollars, benefiting groups such as Lazarus, linked to North Korea, for Tornado. Which also made an American parliamentarian say that half of this dictatorship’s nuclear program is “financed by the theft of cryptocurrencies made possible by mixers”. Pertsev was named as the facilitator of this type of embezzlement. The 31-year-old developer of Russian origin was arrested in the Netherlands in 2022 and finally sentenced this Tuesday, May 14 to 5 years in prison.
On X, Telegram or its website dedicated to his case, his defenders, including whistleblower Edward Snowden, accused the blow. They had maintained for more than two years that Pertsev had only “coded” a program. And that the open source nature – the code is open for consultation – and decentralized of the tool made any dishonest intention on the part of its owner improbable. You should also know that cryptocurrencies are sometimes used by opponents and human rights activists around the world so that their financial exchanges escape their oppressors. Hence this legitimate need for confidentiality through mixers. Condemning Pertsev was ultimately condemning the right to online privacy.
“The suspect chose to look away”
This assertion is obviously questionable. On the one hand, providing such means to criminals may be wrong, even unintentionally. The quantum of Pertsev’s sentence depended from the start on the degree of negligence, or even complicity, of the defendant. And that’s where the developer’s story got complicated. The latter “chose to look away from the abuse and take no responsibility for it. In the meantime, [il] has managed to enrich itself from its service of hiding criminal assets”, notes the jugement handed down by the Dutch East Brabant Court. Before the trial, from the American media Wired, the prosecutor explained that it was clear, based on the evidence collected, that Pertsev had constantly improved his program, making it ever more attractive to money launderers, despite strong suspicions of illegal use. According to the prosecution, almost a third of the funds “mixed” by Tornado between 2019 and 2022 were fraudulent. Could he ignore it? “Under the pretext of an ideology [NDLR : la défense de la confidentialité en ligne] he did not care about legislation and regulations and felt untouchable”, also underlines a court declaration. With several comrades, Pertsev not only built a particularly powerful tool, but what is more, worked hard to make it uncontrollable. In fact, Tornado Cash, now illegal in the United States, with its appointed administrators behind bars, still continues to operate.
The Pertsev affair shows why it is time to stop defending cryptocurrency “mixers”. Appearing around 2011, these software such as Bitcoin Fog, Chip Mixer, Bestmixer mainly hit the headlines due to their use by criminals. Sometimes, their developers even turned out to be conscientious accomplices of the launderers: a reality which undoubtedly made the Dutch justice system more suspicious of Pertsev, far from being the first to be convicted in the sector. Today, the simple use of a blender is suspect; a bill carried by members of the United States Congress calls for the establishment of a moratorium on all software of this type while a way is found to regulate it. In the crypto world either, mixers, also called blenders, are no longer seen as the ideal solution for improving user privacy.
The French crypto lobby, Adan, points out their “vices” on its site, while that of Bitcoin highlights their many “limitations”. “Such services also require trusting the individuals who operate them not to lose or steal your funds or to keep a log of your requests.” This same source also prefers to highlight other avenues for native improvements, more ethical, still in development. Vitalik Butherin, the creator of the Ethereum protocol, published first works encouraging measures to introduce more discretion, while ensuring the legality of funds in transactions thanks to the “zero-knowledge proof“. These solutions will surely take time to mature. Which is not necessarily problematic: the crypto ecosystem remains young after all and the use of these assets remains marginal in the global economy. These ideas deserve in all case surely more attention than the “mixers” with a sulphurous reputation, at a time when crypto seeks to regain the confidence of the political and economic world.
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