Did you hear about the court decision on Tornado Cash? The smart contracts were cleared of sanctions!

Wait, what? Tornado Cash? Isn’t that the thing people used to mix crypto to stay anonymous? I thought it got into trouble last year.

Exactly! The U.S. Treasury had sanctioned it, saying it helped with illegal transactions. But now, a court ruled that Tornado Cash’s smart contracts can’t be treated as property.

Smart contracts can’t be property? How does that work? I thought everything on the blockchain was owned by someone.

Not quite. Tornado Cash’s smart contracts are immutable, meaning they can’t be changed or controlled by anyone. Once deployed, they just run on their own, like a machine that works automatically.

So, no one owns them? They’re just… out there, doing their thing?

Pretty much! The court said that because these contracts are autonomous and no one controls them, they don’t fit the legal definition of property or services.

But why did the Treasury sanction them in the first place? Were they trying to stop people from using them for illegal stuff?

That was the idea. The Treasury said the contracts were used for laundering money. But Coinbase and others argued that punishing the technology itself was wrong because it’s open-source and neutral. They even backed the legal case against the Treasury.

Hmm, so the court basically said the Treasury went too far?

Exactly. The court ruled that the Treasury exceeded its authority. It said that regulating this kind of technology isn’t their job—it’s Congress’s responsibility to make those laws.

Makes sense. But if the smart contracts are off the hook, what about the rest of Tornado Cash?

Good question! The court only cleared the specific smart contracts. Other parts of Tornado Cash, like its governance or tools, could still face sanctions.

Wow, this is complicated. So, the ruling isn’t just about Tornado Cash—it’s about how we treat decentralized tech in general?

Exactly! It’s a big deal because it sets a precedent. It’s like saying open-source technology shouldn’t be banned just because some people misuse it.

I guess it’s like banning a knife because someone might use it the wrong way. Doesn’t seem fair to the tool itself.

That’s a perfect analogy! This case shows how important it is to think carefully about how laws apply to new technology.

Wow, I’ve got a lot to think about now. Decentralized tech really changes the game, huh?

It sure does. And this ruling is just one piece of a much bigger conversation!