Paul Grewal, Chief Legal Officer (CLO) of Coinbase, has publicly voiced support for Tornado Cash, a popular crypto mixer embroiled in a legal dispute with US authorities over allegations of money laundering. In a recent thread on social media platform X, Grewal highlighted Tornado Cash's response to the United States Treasury, indirectly signaling Coinbase's backing of the mixer.

"We continue to support a critical legal challenge to preserve Americans' right to privacy. Today, the Tornado Cash plaintiffs replied to Treasury's arguments in the Fifth Circuit Court of Appeals with a very strong brief," Grewal wrote.

Grewal detailed Tornado Cash's response, emphasizing the need for the Treasury to establish its case against an association of individuals with a common purpose. He noted the agency's shifting argument, alleging that Treasury, its developers, and all TORN token holders share a common goal. However, Tornado Cash's filing contests the Treasury's authority under the International Emergency Economic Powers Act (IEEPA), stating that it fails to satisfy statutory requirements.

According to Tornado Cash's response, the Treasury seeks to control the mixer under the IEEPA, claiming authority to prohibit American citizens from interacting with open-source software code. Grewal argued that immutable and open-source software code does not qualify as "property" under existing laws, emphasizing the necessity for congressional authorization to regulate its use.

Coinbase's support for Tornado Cash dates back to last April when it backed action seeking to overturn the mixer's ban. However, a dismissal by Judge Robert Pitman of the US District Court for the Western District of Texas halted the case, ruling in favor of the Treasury Department's right to sanction Tornado Cash. Despite the setback, Grewal remains optimistic, urging for a careful consideration of the legal challenge by the Fifth Circuit.

As Coinbase continues to advocate for privacy rights in the crypto space, its stance on the Tornado Cash legal battle underscores its commitment to defending user privacy and promoting a regulatory environment that fosters innovation while upholding legal standards.