{"id":36776,"date":"2025-07-14T13:16:59","date_gmt":"2025-07-14T13:16:59","guid":{"rendered":"https:\/\/dogewisperer.com\/?p=36776"},"modified":"2025-07-14T13:16:59","modified_gmt":"2025-07-14T13:16:59","slug":"right-to-code-tornado-cash-dev-roman-storms-money-laundering-trial-kicks-off-monday","status":"publish","type":"post","link":"https:\/\/dogewisperer.com\/?p=36776","title":{"rendered":"Right to Code? Tornado Cash Dev Roman Storm’s Money Laundering Trial Kicks Off Monday"},"content":{"rendered":"
\n

NEW YORK, New York \u2014 Tornado Cash developer Roman Storm\u2019s criminal money laundering is slated to begin in Manhattan on Monday morning, when Storm\u2019s lawyers and prosecutors will begin to select a jury to oversee Storm\u2019s four-week trial.<\/p>\n<\/p>\n

Storm was arrested in Washington state in 2023 and charged with conspiracy to commit money laundering, conspiracy to violate U.S. sanctions, and conspiracy to operate an unlicensed money transmitting business \u2014\u00a0charges which, if Storm is convicted, carry a maximum combined sentence of 45 years in prison. Storm\u2019s fellow Tornado Cash developer, Russian national Roman Semenov, faces the same charges but remains at large. Another developer, Alexey Pertsev, was convicted of money laundering<\/a> in the Netherlands in 2024 and sentenced to five years in prison, which he is currently appealing<\/a>.<\/p>\n<\/p>\n

At the heart of Storm\u2019s case lies Tornado Cash, a privacy-oriented cryptocurrency mixing service, which the government has alleged was used to launder over $1 billion in criminal proceeds by bad actors \u2014\u00a0including the Lazarus Group, North Korea\u2019s state-sanctioned hacking operation, which they say constituted a violation of U.S. sanctions \u2014\u00a0while Storm and his colleagues turned a blind eye. Storm\u2019s lawyers, meanwhile, have argued that he was simply a developer of open-source, decentralized software<\/a> with legitimate, privacy-preserving uses who should not be held responsible for bad actors\u2019 use of it.<\/p>\n<\/p>\n

\u201cThere\u2019s certainly going to be a very vigorous defense here that they were writing code and that [Tornado Cash] was designed for privacy \u2014\u00a0that some people may have taken advantage of it, but [Storm and his colleagues] weren\u2019t co-conspirators,\u201d said Mark Bini, a partner in Reed Smith\u2019s global regulatory and enforcement practice group. \u201cMixers have been very controversial because they\u2019ve been used by lots of people doing bad things, no doubt about it, but the idea that some people would want to use them for privacy, that\u2019s a legitimate argument as well. That\u2019s going to make for a fierce battle here.\u201d<\/p>\n<\/p>\n

Storm\u2019s trial has drawn the attention of many in the crypto industry, who have raised concerns<\/a> that, if Storm is found guilty, it could mean that developers down the line are on the hook<\/a> for how people use their programs \u2014\u00a0something that could have devastating consequences for both the availability of privacy tools and the decentralized finance (DeFi) space as a whole. A host of major players in the industry, including investment firm Paradigm, and non-profit advocacy groups Coin Center and the DeFi Education Fund, have submitted amicus briefs in Storm\u2019s defense.<\/p>\n<\/p>\n

Others, however, have been more reluctant to accept Storm\u2019s privacy defense. Economics writer J.P. Koenig wrote in a 2024 blog post<\/a> that, if Storm prevails at trial, it could “potentially mean that anyone who wants to facilitate illegal activities would have a strong incentive to copy Tornado Cash, effectively turning their operation into a \u2018golem\u2019 \u2014\u00a0a deathless artificial being run on smart contracts \u2014\u00a0and then throwing away the keys to avoid the law.\u201d<\/p>\n<\/p>\n

Swiss blockchain analytics firm Global Ledger wrote in a blog post<\/a> that there are, in general, \u201cfar more reasons why cyber criminals might want to use a mixing service than developers who legitimately want to obfuscate the movement of their personal funds.\u201d<\/p>\n<\/p>\n

Shifting winds<\/h2>\n<\/p>\n

Storm\u2019s trial begins as the U.S. government continues to overhaul its approach to the crypto industry \u2014\u00a0particuarly crypto regulation. Under U.S. President Donald Trump, the White House has taken a friendlier stance towards the industry (which poured a whopping $130 million<\/a> into congressional races in the 2024 elections and at least $18 million into Trump\u2019s inaugural committee alone), nudging regulators and law enforcement to do the same.<\/p>\n<\/p>\n

Since Trump took office in January, the U.S. Securities and Exchange Commission \u2014\u00a0which had taken on a bogeyman-like status under former Chair Gary Gensler for its so-called practice of \u201cregulation by enforcement” \u2014\u00a0has formed an industry-friendly Crypto Task Force and dropped a slew of open cases and investigations into crypto companies. In an April memo to staff<\/a>, Deputy Attorney General Todd Blanche ordered U.S. Department of Justice (DOJ) staff to \u201cnarrow\u201d their focus on crypto crime, instructing them that the agency would no longer be charging regulatory violations in cases involving crypto.<\/p>\n<\/p>\n

Though some speculated that prosecutors would back down from their case against Storm in the wake of Blanche\u2019s memo, the government pressed forward<\/a>, dropping just one part of one charge. Prosecutors also opted to continue with their case against Storm in March after the U.S. Treasury Department\u2019s Office of Foreign Asset Control (OFAC) delisted Tornado Cash from their list of sanctioned entities, after a federal judge ruled that the agency could not sanction a smart contract.<\/p>\n<\/p>\n

\u201cFrankly, I was kind of surprised it was going forward after we saw that [Tornado Cash] was taken off the OFAC list,\u201d Bini said. \u201cWe don\u2019t know the government\u2019s evidence yet, but we\u2019ve seen the Trump Administration really move away from these sort of regulatory-type cases. And this seems like one that is on the edges of that because the conspiracy to operate an unlicensed money transmitting business [charge] does seem like the type of regulatory case that perhaps the Administration is getting out of the business of.\u201d<\/p>\n

Storm on trial<\/h2>\n<\/p>\n

During a pre-trial conference last week, District Judge Katherine Polk Failla of the Southern District of New York (SDNY) ruled that neither side could bring up the OFAC sanctions \u2014\u00a0either that Tornado Cash was sanctioned in the first place or that the sanctions were subsequently removed \u2014\u00a0during Storm\u2019s trial, arguing that it would confuse the jury. Failla also ruled that neither party could mention the outcome of a related civil case, Van Loon vs. Department of the Treasury.<\/p>\n<\/p>\n

Bini told CoinDesk that Failla\u2019s ruling to keep the OFAC sanctions out of the trial is likely to help the government\u2019s case more than Storm\u2019s.<\/p>\n<\/p>\n

If the defense was able to tell the jury that OFAC\u2019s sanctions were later dropped, Bini said, \u201cI think you\u2019re more likely to have jurors say \u2018gosh, I\u2019m not sure of whether this is illegal or not.\u2019 And if they\u2019re not sure, well, then the defendant is not guilty. I think that ruling probably helped the government to some extent in making the case seem cleaner and less complicated.\u201d<\/p>\n<\/p>\n

Bini said that, if the trial results in a conviction, Failla\u2019s ruling presents potential grounds for Storm\u2019s lawyers to appeal.<\/p>\n<\/p>\n

\u201cThe defense may say, ‘hey, we should have had the right to present that to the jury, we think that\u2019s important evidence,\u2019\u201d he said. \u201cThis is the type of case where even if the government gets a conviction as they usually do, there really may be some legal infirmities.\u201d<\/p>\n<\/p>\n

If the jury finds Storm guilty, Bini said that there might be another option beyond an appeal \u2014\u00a0a presidential pardon. Trump has pardoned a number of people in the crypto industry since taking office in January, including the co-founders of BitMEX and Silk Road founder Ross Ulbricht.<\/p>\n<\/p>\n

\u201cLet\u2019s say it results in a conviction, that doesn\u2019t mean that the President might not get involved afterwards,\u201d Bini said. \u201cThat\u2019s a bit of a wild card that we could see play out here if the case results in a conviction.\u201d<\/p>\n<\/p>\n

In a final pre-trial conference on Friday, Storm\u2019s lawyers made a last-ditch effort to get the case dismissed after the government revealed that its theory of venue (basically, the prosecution\u2019s justification to bring the case in the Southern District of New York) hinged on three pieces of evidence \u2014\u00a0Storm\u2019s texts to a New York-based venture capitalist, Storm\u2019s interview with a New York-based Bloomberg reporter and the fact that a hacker accessed Tornado Cash from New York.<\/p>\n<\/p>\n

Failla ultimately ruled against the defense\u2019s motion, allowing the government\u2019s case against Storm to proceed to trial.<\/p>\n

The next four weeks<\/h2>\n<\/p>\n

Storm\u2019s trial, initially slated for two weeks, is expected to run a full month due to the sheer number of witnesses in the case. The government alone told the court it planned to call more than 20 people to testify, including a hacker who used Tornado Cash, a so-called \u201cvictim\u201d witness and a host of expert witnesses.<\/p>\n<\/p>\n

Jury selection is expected to take two days, with opening arguments likely slated for Wednesday.<\/p>\n<\/p>\n

Storm has not yet indicated either way whether he will testify in his own defense, but Bini said it could be a big help for his defense.<\/p>\n<\/p>\n

\u201cI think there\u2019s a really good chance [Storm] will testify. If so, [he\u2019s] going to have to withstand some really stiff cross [examination], but that could be really powerful in a case like this,\u201d Bini said. \u201cThe burden is on the government, not the [defense], but they might want to take the stand and tell the jury their story.\u201d<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

NEW YORK, New York \u2014 Tornado Cash developer Roman Storm\u2019s criminal money laundering is slated to begin in Manhattan on Monday morning, when Storm\u2019s lawyers and prosecutors will begin to select a jury to oversee Storm\u2019s four-week trial. Storm was arrested in Washington state in 2023 and charged with conspiracy to commit money laundering, conspiracy […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"iawp_total_views":0,"footnotes":""},"categories":[2],"tags":[3,4,5],"class_list":["post-36776","post","type-post","status-publish","format-standard","hentry","category-news","tag-crypto","tag-doge","tag-news"],"_links":{"self":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts\/36776","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=36776"}],"version-history":[{"count":0,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts\/36776\/revisions"}],"wp:attachment":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=36776"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=36776"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=36776"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}