Tornado Cash Trial Now in Jury’s Hands as Legal Battle Over Crypto Privacy Tool Nears End – Crypto News – Crypto News
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Tornado Cash Trial Now in Jury’s Hands as Legal Battle Over Crypto Privacy Tool Nears End Tornado Cash Trial Now in Jury’s Hands as Legal Battle Over Crypto Privacy Tool Nears End

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Tornado Cash Trial Now in Jury’s Hands as Legal Battle Over Crypto Privacy Tool Nears End – Crypto News

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After two weeks of heated testimony and debate, the case against Roman Storm now rests with a jury.

More than two weeks after opening statements in the federal trial of Roman Storm – a software developer and co-creator of the crypto privacy tool Tornado Cash – the jury is currently deliberating in a case that could shape the legal future of decentralized finance (DeFi).

The trial, unfolding in the Southern District of New York, focuses on Storm and his co-founder, Roman Semenov, who was added to the U.S. sanctions list in August 2023 and remains at large. Prosecutors allege the two knowingly enabled money laundering through Tornado Cash, even as they publicly promoted it as a privacy tool.

Storm faces three federal conspiracy charges: conspiracy to commit money laundering, conspiracy to violate the International Emergency Economic Powers Act (IEEPA) through sanctions violations, and conspiracy to operate an unlicensed money transmitting business. If convicted on all counts, he could face up to 45 years in prison.

The case could have sweeping consequences for how U.S. law treats decentralized technology. Some developers and legal experts worry that if Storm is found guilty for simply writing code, it could make it risky for others to build open-source tools, especially those focusing on privacy.

Money Laundering Claims

According to the indictment, the federal government alleges that a large portion of the funds moving through the platform came from illegal activity, and the founders were aware of it.

Prosecutors also assert that Tornado Cash was used to launder over $1 billion, including hundreds of millions linked to Lazarus Group, a North Korean hacking organization under U.S. sanctions. The Office of Foreign Assets Control (OFAC) sanctioned Tornado Cash in August 2022, and the Department of Justice announced the indictment against Storm and Semenov in August 2023.

“The defendants in fact knew that it was a haven for criminals to engage in large-scale money laundering and sanctions evasion,” the document reads. “Indeed, as the defendants well knew, a substantial portion of the funds the Tornado Cash service processed were criminal proceeds passed through the Tornado Cash service for purposes of concealment.”

During the trial, prosecutors emphasized these allegations and also focused on personal stories to make their case. Among them was a woman from Georgia who claimed to have lost around $250,000 in a pig-butchering scam.

No Control Over Software

The defense argues that Storm created software, not a criminal enterprise, and that he had no operational control over how others used it. They emphasized that Tornado Cash was a non-custodial tool and Storm had no means to stop malicious actors from using it.

They told the jury that Storm never intended for hackers to exploit Tornado Cash, emphasizing that the protocol was designed to help everyday people send and receive money privately. They also presented messages between Storm and Semenov that revealed how upset Storm was upon learning that criminals were exploiting the platform.

Divided Opinions

Legal observers are divided. Some argue a conviction could chill open-source innovation, while others say developers must be accountable when their tools facilitate crime.

“ The precedent being set here could ultimately be used to prosecute open source software developers for the use of their tools,” said crypto reporter David Morris on the “11AM” podcast. Morris also likened the situation to gun manufacturers, who are not held legally liable for crimes committed by gun owners.

Meanwhile, Dave Craige, a partner at Studio Capital, retorted on X, “I’m sorry but that is incorrect. He built a money laundering crypto mixer. There were 8 before him. ALL have been illegal. ALL have been involved in money laundering. ALL of the devs have gone to court/jail.”

What now?

Closing arguments took place earlier this week, with prosecutors and defense attorneys each speaking for about 90 minutes. The government then gave a 45-minute rebuttal before the jury began deliberations.

There is no time limit for U.S. jury deliberations — they can last hours, days, or even weeks.

Storm remains out on a $2 million bail, under 24-hour electronic monitoring and travel restrictions.

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