Tornado Cash is still being used to launder stolen ETH—how much will this contradiction affect institutional trust?

While regulatory compliance narratives are advancing rapidly, Tornado Cash remains the hacker's last escape. This contradiction will seriously impact institutions' trust in ETH ecosystem infrastructure.

Institutions fear two things most: regulatory uncertainty and reputational risk. The fact that Tornado Cash can still be used after sanctions indicates that on-chain privacy tools are highly resilient, but it also reveals significant loopholes in compliance pathways. Before investing their funds into the ETH ecosystem, institutions will repeatedly ask themselves: Will my funds be subject to sanctions because of a certain privacy tool?

If this contradiction isn't resolved, large-scale institutional participation will always remain a castle in the air.