Tornado Cash developer Roman Storm, who was arrested in August and hit with three charges related to his role as co-founder of the Ethereum privacy protocol Tornado Cash, received support in the form of three amicus briefs. Prominent pro-crypto organizations.
Storm moved to drop the charges against him last week, saying the government’s argument was “fatally flawed” in its characterization of Tornado Cash’s service and various elements of blockchain technology. Roman Semenov, a Russian national and co-founder of Tornado Cash, who faces the same charges, remains at large, while Alexey Pertsev, another co-founder, is currently awaiting the outcome of his trial in the Netherlands whose verdict is expected in May. 14.
The three amicus briefs were filed by Coin Center, the Blockchain Association, and the DeFi Education Fund. The briefs, although written and filed separately, present largely similar arguments against the government’s characterization of the case in its indictment.
For example, the government charge alleges that Semenov and Storm “engaged in money transfer activities on behalf of the public”, but that Tornado Cash was not registered with the US Financial Crimes Enforcement Network (FinCEN), leading to a charge of conspiracy to operate an unlicensed money transfer business.
However, the Blockchain Association, in its Short, points out that this characterization goes against FinCEN’s own definitions. “Unless the intermediary exercises completely independent control over the assets, the money transmitter cannot be held liable,” the brief states. “Indeed, FinCEN’s own guidelines recognize that ‘anonymization software providers’ are not money transmitters.”
The brief goes on to detail how Tornado Cash operates without giving its developers independent control over user assets, and threatens that if the government’s position that Tornado Cash is a money transfer business is maintained, then ” …compliance with the Bank Secrecy Act could be impossible for developers, meaning the government’s interpretation amounts to a ban on anonymization protocols.
Coin Center’s brief focuses on the arguments against the count of conspiracy to violate the International Economic Emergency Powers Act (IEEPA) and provides a First Amendment defense to the charges. The conspiracy tally, which concerns Tornado Cash’s alleged sanctions violations, is unlikely to hold up because “release decisions about what the software would do and how to release it were made long before it was released.” is aware of the existence of the software. [North Korean state-sponsored hackers] The activities of the Lazarus group could even have existed,” the brief states. argues.
To claim that Tornado’s founders colluded with Lazarus would be to suggest that “the developers of the open source Linux operating system confederated with the Iranian regime, simply by freely releasing a valuable computing tool that Iran would later use to operate computers linked to its weapons. programs,” the brief continues.
The DeFi Education Fund’s brief, in opposing the charges, also presents a dire perspective on how the legal world could change if Storm loses his case. “These theories of liability, if validated by the Court, would grant the government unlimited power to sue any software developer who writes code that is then used by a third party for nefarious purposes, simply because the developer takes note of this subsequent use.” the brief bed. “In the absence of a limiting principle, almost all developers who create open source software would be exposed to criminal liability for activities beyond their control years or decades later.”
Government prosecutors have not yet responded to Storm’s motion to dismiss the charges against him.
Disclaimer: The Block is an independent media outlet providing news, research and data. Since November 2023, Foresight Ventures has been a majority investor in The Block. Foresight Ventures invests in other companies in the crypto space. Crypto exchange Bitget is an anchor LP for Foresight Ventures. The Block continues to operate independently to provide objective, impactful and current information about the crypto industry. Here is our current financial information.
© 2023 The Block. All rights reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.