First, some context for the normies among us (
): with most cryptocurrencies, everything you do is public and has no privacy guarantees beyond pseudononymity, which is often easily broken. This is problematic for drug buyers, money launderers, and also anyone who doesn't want their purchases, political donations, and so on to be literally public information. One way to deal with this problem is to use a currency like XMR that was designed from the start to be private, but everyone else out there can get their privacy with sketchy and inconvenient services created after the fact, called "mixers." A mixer is essentially a laundering service: you and a bunch of other people put in money, it gets shuffled around a bunch, then it gets paid back out to your other addresses, theoretically, though not necessarily always actually, anonymized beyond any hope of tracing.
Recently, the Ethereum mixer Tornado Cash was sanctioned by the US Treasury. Apparently, it has been used to launder over $500 million in fake internet coins, much of it by North Korea. This is big news in the crypto world, you can find articles about it everywhere from real news sites, not just crypto rags. It's not completely unprecedented, since the Bitcoin mixer Blender.io was also sanctioned a couple months ago, but it seems like nobody really cared about that one, it must not have been popular. Looks like it was only used to launder $20 million, that's chump change.
Since Tornado is now sanctioned, it has become illegal to do business with them, and coins currently held in their smart contract (the service) are effectively tainted. This is serious stuff so companies are cutting ties and covering their ass. Correspondingly, people on the World Wide Web are freaking out, mostly by making twitter posts, and by posting like 20 articles about it on HN.
The first interesting drama is with Github (HN, Twitter). After Tornado was sanctioned, Github deleted the Tornado code repositories hosted on their service (not found, despite archive) and went on to delete the Github accounts of several people who had contributed to the project, which seems a little ex post facto to me but 
. Opinions are divided! Many people are angry at the Treasury, some people are angry at github for covering their ass, but the prevailing attitude on HN is this one given by junon:
People on Twitter are either wilfully dumb or simply ignorant.
GitHub had to do this. It was required of them by law. Tornado was sanctioned.
These prohibitions include the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any blocked person and the receipt of any contribution or provision of funds, goods, or services from any such person.
This is, unambiguously, directed toward entities such as GitHub providing them service.
I'm not a fan of GH these days but they did the only thing they could do in this situation. You can be upset about it, but you can't be upset at GitHub about it.
One Twitter user, @rossdefi, asks [marsey added]:
Is it time for a decentralized github? Surely that must already be a thing?
I wonder if this person is aware of a decentralized tool called git. It even involves a blockchain, at least by a certain definition of the term.
However the more interesting, in my opinion, drama coming out of this is this "dusting" thing. It's illegal for U.S. persons to transact with Tornado, but the thing is that people can send you cryptocurrency without your consent. Normally free money is nothing to complain about, but in this case it is tainted by legal liability since it can be traced back to Tornado's mixing service. A chaosmaxxer cryptochad has therefore decided to make a point by sending out a bunch of his now-sanctioned Ethereum coins in 0.1 ETH bundles (about 170 freedombux) to random people in what is being called a "dusting" attack (HN, Etherscan). It seems some of those targeted are e-celebs including "Coinbase CEO Brian Armstrong, TV host Jimmy Fallon, clothing brand Puma and a wallet created for donations to Ukraine." (HN, Coindesk (warning js cancer website), Twitter)
You could try to ignore the coins and not spend them to keep liability away from yourself, but a user on HN, ArtTimeInvestor, explains a further issue:
Ethereum is very different in this regard than Bitcoin.
Ethereum has accounts. So when Ana sends coins to Berta, Berta has no way to leave those coins untouched. As they just raise the amount of coins she owns. So next time Berta sends coins to Charles, it is unclear which coins she sent and if those include Ana's coins.
Bitcoin on the other hand has no accounts. When Ana sends coins to Berta, she just marks those coins as "Can be spent by Berta in the future". Berta can decide to never touch them. When Berta sends coins to Charles, she decides which of her coins she sends.
What a pickle! You can't refuse to accept money with either currency, but with Bitcoin you can at least pretend like the tainted coins don't exist and never spend them. With Ethereum they're all combined so it's impossible to easily control your legal liability by not using them. It seems inevitable that tainted coins will slowly diffuse with normal ones, so the enforcement on these sanctions is surely going to be subjective and may bring future drama. Large-scale transactions of the tainted coins will probably be picked up, but they probably won't check every 0.1 ETH recipient -- yet if done on a large scale, sending these 0.1 ETH transactions becomes a way in itself to launder the tainted money a second time and untaint it!
Moral of the story: use 
to buy your darkweb meth and ignore all other forms of cryptocurrency.
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Smart contracts are the crypto killer ap, monero is good though.
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