Tornado Cash Governance
Tornado.cash recently announced a governance protocol proposal, introducing the TORN token.
Yesterday that proposal was brought to life and the UI has been updated to include anonymity mining and governance support.
Tornado Cash is an anonymity service. Every Ethereum transaction is publicly (and permanently) viewable on the blockchain, but with Tornado users can get around this. It operates as a non-custodial mixer. Users deposit their ETH, DAI, cDAI USDC, or USDT, wait, and then withdraw to a clean wallet.
As part of the governance proposal 5% of the total TORN supply was airdropped to users of the service, giving a greater share to larger and older users. Users have one year to claim their TORN (exchanging for the non-transferable vTORN).
Anonymity Mining
A core component of the proposal is anonymity mining, a method of incentivising liquidity on the platform. This should greatly improve the service as the more users interact with the protocol, the greater the anonymity set becomes.
In order to preserve provider’s anonymity the system is quite complex, but the tl;dr is that users need to deposit onto the platform and earn Anonymity Points. These AP can be exchanged for TORN tokens at any time, with one million TORN dripped into an AMM each year.
Conclusion
While some have seen the announcement as a free airdrop for hackers and rug-pulls, I’m happy to see the update from Tornado.Cash.
The protocol provides a valuable service, and I’m a committed believer in the right to digital privacy. In the age of the surveillance state Tornado.Cash is hugely needed, and I have no problem with the developers funding their work and incentivising a greater anonymity set.
It will be interesting to see how governance develops moving forwards.
Try out Tornado.Cash today and read the full announcement.
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