Van Loon v Department of the Treasury (Fifth Circuit, 2024)

Van Loon v Department of the Treasury is a 2024 Fifth Circuit judgment limiting one use of the International Emergency Economic Powers Act (1977) against the Tornado Cash cryptocurrency protocol. The court held that the immutable smart contracts in the record were not property in which a foreign national or entity had an interest. OFAC therefore lacked authority under IEEPA to block those contracts. The holding concerns the statutory property requirement, not a general immunity for software, mixers or digital-asset transactions.

Designation and dispute

OFAC designated Tornado Cash in August 2022 and redesignated it in November. Treasury alleged that the service had been used to launder stolen virtual currency, including proceeds attributed to the North Korean Lazarus Group. Six users challenged the action after OFAC identified protocol addresses alongside associated persons and property.

The Fifth Circuit distinguished mutable arrangements controlled by people from autonomous code that no one could alter, remove or exclude others from using. It concluded that the immutable contracts were neither contracts in the ordinary legal sense nor ownable property. The court reversed the district court and remanded. It did not decide whether Congress could enact a different authority or whether OFAC could designate persons, controlled interfaces, wallets or other property connected with a mixer.

Later status and boundary

Treasury removed Tornado Cash from its sanctions list on 21 March 2025 after reviewing the legal and policy issues raised by evolving technology. The 2022 designation and redesignation remain part of the historical record but no longer establish current listing status.

The civil judgment must remain separate from criminal proceedings involving individual developers. A statutory holding about property does not determine a person's knowledge, conduct or criminal liability. Any named developer and current case posture require publication-day review.

Statecraft significance

The decision identifies a technical boundary in a blocking statute built around property and interests in property. It matters because OFAC digital asset sanctions practice (2018 to present) depends on mapping code, services, legal persons and assets to an operative legal authority. The decision did not disable that practice. It required Treasury to distinguish sanctionable persons and property from immutable code outside IEEPA's language as interpreted on this record.

The judgment also illustrates how technical architecture can change the object of regulation. A controlled interface, administrator key, fee stream or wallet may present ownership and control features that immutable contracts do not. Legal analysis must therefore describe the specific component rather than use "Tornado Cash" as if it identified one person, service and asset. Treasury's earlier factual allegations remain official claims about use of the service, not findings made by the appellate court.

The record belongs in context rather than the main sequence. It is judicial review of a statecraft instrument, not an independent statecraft act. Claims about continuing private screening, the decision's novelty or future congressional action require evidence beyond the judgment and delisting notice.

See also

United States designation and delisting of Tornado Cash (2022-2025) · Cryptocurrency mixers and tumblers (Tornado Cash, Blender.io) · OFAC digital asset sanctions practice (2018 to present) · OFAC general licences · Financial exclusion

Sources

• United States Court of Appeals for the Fifth Circuit, *Van Loon v Department of the Treasury*, No. 23-50669, 26 November 2024.
• United States House of Representatives, International Emergency Economic Powers Act, 50 USC chapter 35, checked 30 July 2026.
• President of the United States, Executive Order 13694, 1 April 2015, as amended.
• United States Treasury, Treasury sanctions Tornado Cash, 8 August 2022.
• United States Treasury, Tornado Cash redesignated with additional DPRK authorities, 8 November 2022.
• United States Treasury, Tornado Cash delisting, 21 March 2025.