Roman Storm, co-founder of Tornado Cash, detailed his persecution in a Jan. 22 post after as a ‘terrifying criminalization of privacy’. Tornado Cash is a non-custodial privacy protocol that enables private crypto transactions via open source code.
He stated:
“I’m being prosecuted for writing open source code that enables private crypto transactions in a completely non-custodial way […] The charges against me threaten to criminalize software development itself.”
Storm is charged with running an unlicensed money transmission company, conspiracy to launder money and evading sanctions. He was arrested on August 23, 2023 and his trial is scheduled for April 14, 2025.
The impact of the case is already clear. Storm noted that another developer, Michael Lewellen, recently filed a lawsuit against the Department of Justice (DOJ), seeking relief from the fear of releasing new software in the wake of Storm’s prosecution.
The Lewellen Trial addresses the same reasoning the DOJ used to prosecute the developers of Tornado Cash and Samourai Wallet. This reasoning could have broad implications as it could result in the criminalization of software development.
Storm’s statement comes after the Fifth Circuit Court of Appeals ordered the U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) to remove Tornado Cash-linked addresses from the list of Specially Designated Nationals and Blocked Persons (SDN).
Furthermore, the ruling emphasized that sanctioning the protocol will not deter bad actors from using it as smart contracts are autonomous and cannot be managed, monitored or modified.
The court also suggested updating legislation to regulate the use of crypto mixers. As a result, the current legal framework should not prevent applications such as Tornado Cash from operating autonomously.
On November 26, the U.S. Court of Appeals did so already determined that the Treasury Department has exceeded its authority by sanctioning Tornado Cash’s immutable smart contracts. The legal victory motivated Storm to do so submit a motion on Dec. 20 requesting that the charges against him be dropped.
Support from Vitalik Buterin
In a separate one message on social mediaStorm Thank you Ethereum co-founder Vitalik Buterin for supporting his and fellow Tornado Cash developer Alexey Pertsev’s business.
Buterine replied that Tornado Cash was built with his support, and that not supporting the developers would “violate fundamental honor.”
The Ethereum co-founder added:
“In Ethereum we protect ours and uphold our honor.”
The problem with section 1960
Storm also highlighted the confusion surrounding the Section 1960 charge for operating an unlicensed money transmission business. He pointed to conflicting interpretations of the law by different government agencies, which have muddied the waters of compliance and regulation for developers like himself.
Amanda Tuminelli, the Chief Legal Officer at the DeFi Education Fund, concerns expressed on the Department of Justice (DOJ) interpretation of Section 1960 in December 2024.
Tuminelli argued that Section 1960 was poorly drafted and haphazardly amended, leading to legal ambiguities and conflicting interpretations. The article traced the historical evolution of the statute and highlighted its “complicated” and “peculiar” language, which has been criticized by courts for being difficult to interpret.
Furthermore, she claimed that protocols like Tornado Cash, which are non-custodial and have no control over users’ funds, should not fall within the scope of the law. Using the Roman Storm case as a study, she emphasizes that self-determination protocols cannot be classified as “money transmitting businesses” in the plain language of the statute.
Tuminelli further examined the interplay between Section 1960 and definitions under the Bank Secrecy Act (BSA), arguing that both share a fundamental requirement: an entity must acquire and relinquish control of funds to qualify as a money transmitter.
Entrepreneur Vivek Ramaswamy noted that authorities should not go after developers, but rather pursue bad actors who violate existing laws.
