The legal saga surrounding Roman Storm, the developer of Tornado Cash, has garnered significant attention from crypto advocacy groups, who have rallied in support of his cause. Storm, who found himself in legal jeopardy following his arrest in August and subsequent charges related to his involvement with the Ethereum privacy protocol, Tornado Cash, has recently taken a proactive step by filing a motion to dismiss the charges leveled against him. In his defense, Storm has highlighted what he perceives as flaws in the government’s understanding of both Tornado Cash’s service and the underlying blockchain technology.
Amidst this legal battle, three prominent pro-crypto organizations, namely Coin Center, the Blockchain Association, and the DeFi Education Fund, have stepped forward to lend their support to Storm’s cause. Each of these organizations has independently filed amicus briefs, aligning their arguments against the government’s indictment. Their collective efforts aim to challenge the validity of the charges brought against Storm, underscoring the importance of clarity and accuracy in legal interpretations of blockchain-based technologies.
The US alleges that Storm conducted activities as an unregistered money transmitter.
The government’s indictment accuses Storm and his co-founder Roman Semenov of conducting fund transfers on behalf of the public without registering Tornado Cash with the U.S. Financial Crimes Enforcement Network (FinCEN), leading to the charge of conspiracy to operate an unlicensed money transmitting business. However, the Blockchain Association’s brief points out contradictions in FinCEN’s own definitions regarding intermediaries’ liability as money transmitters. It argues that intermediaries can only be held liable if they exercise total independent control over the assets, which is not applicable to Tornado Cash. The brief warns that accepting the government’s interpretation would effectively ban anonymizing protocols and render compliance with the Bank Secrecy Act impossible for developers.
Coin Center’s brief focuses on disputing the count of conspiracy to violate the International Emergency Economic Powers Act (IEEPA) and presents a First Amendment defense. It contends that the conspiracy count should not hold since decisions regarding Tornado Cash’s functionality and release were made long before any knowledge of alleged sanctions violations. Drawing an analogy to developers of the Linux open-source operating system, the brief argues that suggesting they confederated with a regime merely by releasing a valuable computing tool would be unfounded. It emphasizes that publishing decisions over the software’s functionality and release predate any knowledge of the Lazarus Group’s activities, making the conspiracy allegation baseless.
The DeFi Education Fund contests the accusations against Storm.
The DeFi Education Fund’s brief delves into the charges against Storm, expressing concerns about the potential ramifications if Storm were to be convicted. It argues that accepting the government’s theories of liability could grant them unchecked authority to prosecute software developers for code that is ultimately used by third parties for illicit purposes. This lack of a clear boundary could subject developers of open-source software to criminal prosecution for actions beyond their control, even years or decades after the software’s creation.
The brief highlights the absence of a limiting principle in such cases, which could have far-reaching consequences. It suggests that virtually all developers of open-source software could be vulnerable to criminal charges for activities that occur outside of their influence long after the software’s development.
As of now, government prosecutors have yet to respond to Storm’s motion seeking dismissal of the charges.
Further reading on: The developer of Tornado Cash challenges accusations and files a motion to dismiss, backed by legal arguments.
