Crypto news

When Justice Meets Absurdity: The Tornado Cash Trial Saga

BBG News

In the dimly lit corridors of justice, where shadows dance with the specters of doubt, the venture capital firm Paradigm has taken a bold step, filing an amicus brief in support of the beleaguered Roman Storm, co-founder of Tornado Cash. They argue, with a fervor reminiscent of a Dostoevskian hero, that the jury must be enlightened on the intricate tapestry of the law’s definition regarding the operation of a money-transmitting business. Ah, the law! A labyrinthine construct that often ensnares the innocent in its merciless grip. 🕵️‍♂️

Jury needs the full context of the law

In this amicus brief, submitted to a New York District court on the fateful day of June 13, Paradigm implores the court to ensure that the jury comprehends the gravity of their task. For Storm to be condemned, the prosecution must unveil the truth: that he knowingly operated a money-transmitting business. A daunting task, indeed! This entails charging fees, transmitting funds on behalf of the public, and handling the very proceeds that the prosecution deems criminal. The burden of proof, heavy as a stone, rests upon their shoulders.

Ah, the amicus brief! A curious document, filed by those not directly embroiled in the fray, yet possessing a vested interest in the outcome. It is akin to a spectator at a grand opera, yearning to offer a critique of the performance. 🎭

Tornado Cash, a non-custodial crypto mixing protocol, stands as a testament to the complexities of modern finance. Its developers, noble in their intentions, never hold or control the funds. Yet, the New York US Attorney’s Office, with the fervor of a zealot, contends that Storm conspired to operate this crypto mixing service as an unlicensed money transmitter. The irony! A modern-day witch hunt in the realm of digital currency.

Software developers are not money transmitters

Katie Biber, Paradigm’s chief legal officer, and Gina Moon, the firm’s general counsel, have taken to the digital pages of a blog, proclaiming that the prosecution’s argument is “contrary to the plain text of the law, clear FinCEN guidance, and decades of case law.” A bold assertion, indeed! They invoke the spirit of former President Obama, who in 2014, decreed that software development does not equate to the acceptance and transmission of value. A revelation that should echo through the halls of justice! 📜

Furthermore, they argue that in 2019, the Treasury Department recognized that total independent control over users’ crypto is pivotal in determining whether an intermediary is a money transmitter. “To allow this charge to persist,” they warn, “is to risk letting unelected prosecutors redefine the very essence of criminal statutes, threatening the liberty of everyday citizens who merely follow the widely accepted regulatory guidance.” A chilling thought, indeed!

In a dramatic twist, the US charged Roman Storm and his compatriot Roman Semenov in August 2023, accusing them of laundering over $1 billion in crypto through Tornado Cash. The stakes, dear reader, could not be higher!

A guilty verdict could also hurt innovation

Biber and Moon, with the weight of the world upon their shoulders, declare that the “stakes of this matter are high.” Should Storm be found guilty, the very fabric of innovation and software development in the realms of crypto and fintech could be irrevocably damaged. The ripple effects may extend far beyond, threatening the open-source, AI, and technology communities, as software developers could be held accountable for the actions of their creations. The absurdity of it all! 🤦‍♂️

“This is as ludicrous as prosecuting a television manufacturer for the sharing of state secrets on-air, or leather wallet craftsmen for wallets harboring stolen cash, or even Apple for conspiracies hatched through iPhone conversations,” they quip, with a touch of sarcasm that would make Dostoevsky proud.

The trial, a spectacle of modern justice, is set to commence on July 14. A conspiracy charge to operate an unlicensed money transmitting business was dropped on May 15, following a memo from the Department of Justice that declared they would not prosecute crypto mixers like Tornado Cash for the actions of their users. A twist of fate, perhaps? Only time will tell.

Read More

2025-06-17 06:04

Previous post The First Berserker Khazan Update 1.011.008 Introduces Tons of Changes and Improvements
Next post Marvel Shocks Fans With First Fantastic Four Casting—and It’s Not Who You Think