The U.S. Treasury has submitted a report to Congress recognizing the legality of using crypto mixers to protect financial privacy.

In 2022 and 2023, the department labeled mixers as money laundering hubs and imposed sanctions on Tornado Cash. Now, the Treasury has noted that law-abiding users need these platforms to conceal information about personal savings, business payments, or donations.

However, the criminal use of such services remains a concern. According to the Treasury, from January 2024 to September 2025, hackers linked to North Korea stole $2.8 billion in cryptocurrency, with $1.5 billion coming from the Bybit exchange hack. Malicious actors frequently use mixers to obfuscate their tracks.

Connection to Stablecoins and Bridges

The department has conducted its first analysis of the interaction between mixers, stablecoins, and cross-chain bridges.

Since May 2020, users have withdrawn over $37.4 billion in the two largest stablecoins through 50 different bridges. During the same period, approximately $1.6 billion flowed from mixers to these platforms, with over $900 million of that amount passing through one service favored by North Korean hackers.

Criminals rarely deposit fiat-pegged tokens directly into mixers. Instead, they typically send other assets there. Upon exiting, they convert coins into stablecoins to break the transaction chain before converting to fiat.

Regulation and Types of Mixers

The report distinguishes between custodial and non-custodial services. The former are required to register with FinCEN and can provide authorities with client and transaction data.

For the latter category, the Treasury did not recommend new restrictions. The regulator continues to seek a balance between the risks of illicit financing and citizens' right to privacy.

Treasury Initiatives

The department has requested Congress to pass several new laws. The Treasury proposes:

  • to introduce a freeze right. Financial institutions would be able to temporarily block suspicious crypto assets during investigations;
  • to clarify rules for DeFi. Congress should define which participants in decentralized finance are subject to AML requirements;
  • a "sixth special measure" to the U.S. Anti-Terrorism Act. The Treasury seeks authority to block cryptocurrency transfers outside correspondent banking relationships.

Softening of Government Stance

The report comes amid a shift in government policy regarding crypto privacy. In March 2025, the Treasury lifted sanctions on Tornado Cash following a court ruling. In August, the co-founder of the service, Roman Storm, was found guilty of operating without a license, but the jury could not reach a verdict on money laundering charges.

Later, Matthew Galeotti from the U.S. Department of Justice stated that the department would cease prosecuting DeFi application developers under the unlicensed money transfer business statute.

Notably, in January 2026, Senators Cynthia Lummis and Ron Wyden introduced a bill exempting programmers and providers of non-custodial services from the requirement to obtain money transmitter licenses.