TornadoCash was an illegal decentralized open-source laundering machine.

Downvoters assuming I am shitting on privacy – I am not, please read it first.

If something is illegal, the law won't care if it's decentralized and open-source.

Mixers that accept coins no questions asked are money-laundering machines. Which is illegal.

If you want your coin mixer to be legally compliant, you have to code it in a way, that it only accepts inputs signed by law as fully legal, and deploy a separate mixer for every country, as their laws might differ.

Coin outputs of such a mixer would be flagged by law analysts as "belongs to an unknown law-obeying citizen of <country>", these coins would be mixed, fully private and legal.

KYC coins in, legal private coins out.

And those coins would still be separated from the state because they live on the blockchain, that the state cannot control.

This bust should be a wake-up call for people using those mixers for privacy, that they should rather wait for those mixers to mature if they don't want to have problems with the law.