Quick TakeQuick Take

• The U.S. Treasury Department said in a new report to Congress that crypto mixers can serve valid financial privacy purposes, a notable shift from the agency that sanctioned Tornado Cash in 2022.
• The 32-page report includes original Treasury data on stablecoin laundering flows, recommends Congress create a safe harbor “hold law” for freezing suspicious digital assets, and urges lawmakers to define which DeFi actors should face AML/CFT obligations.
• Treasury disclosed that since May 2020, more than $1.6 billion in deposits from mixing services flowed into crypto bridges, with over $900 million going to a single bridge linked to North Korean laundering.

The U.S. Treasury Department has acknowledged that crypto mixers can serve legitimate financial privacy purposes, according to a 32-page report submitted to Congress this month. The document marks a shift from the same agency that designated international crypto mixers as money-laundering hubs in 2023 and sanctioned Tornado Cash in 2022.

"Lawful users of digital assets may leverage mixers to enable financial privacy when transacting through public blockchains," the report states. It adds that individuals may use them to protect sensitive information on personal wealth, business payments, or charitable donations.

Criminal use of mixing remains a top concern, however. Treasury's data shows DPRK cybercriminals stole at least $2.8 billion in digital assets between January 2024 and September 2025, including the $1.5 billion Bybit hack, and routinely use mixing in multi-step laundering chains.

...read more at theblock.co