Roman Storm, the co-founder of Tornado Cash, has petitioned a US federal judge for acquittal regarding his sole conviction for unlicensed money transmission, along with the jury’s undecided counts for money laundering and sanctions violations. He claims that prosecutors did not demonstrate his intention to assist malicious actors in exploiting the crypto mixer.
Legal documents submitted on September 30 to the US District Court for the Southern District of New York and reviewed by Cointelegraph assert that Storm’s defense contends that prosecutors could not prove he intended to aid bad actors using Tornado Cash. This, they argue, undermines the basis for his conviction due to negligent inaction.
“The assertion that Storm was aware of bad actors using Tornado Cash and neglected to take adequate precautions to stop them constitutes a negligence theory,” the motion indicates.
The defense adds that “in the absence of affirmative evidence showing that Mr. Storm acted with the intent to aid bad actors,” the government tried to satisfy its willfulness burden by alleging that the defendant failed to curb misuse. “This claim contradicts the willfulness standard and lacks legal support,” the motion asserts.
A motion for acquittal requests the judge to dismiss charges or a verdict due to the prosecution’s evidence being legally insufficient, even if true.
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Advocating for privacy rights
Tornado Cash is a decentralized, non-custodial smart contract-based Ether (ETH) mixer that utilizes zero-knowledge proof-based encryption to enhance transaction privacy. Launched by Roman Storm and Roman Semenov in 2019, it allows users to obscure the onchain traceability of their ETH.
The service faced legal issues mainly because it was purportedly used to launder billions of dollars in illicit funds, including those linked to North Korean hackers. The US Office of Foreign Assets Control (OFAC) claimed that Tornado Cash facilitated money laundering, processing over $7 billion in digital currency since 2019, with 30% allegedly associated with illegal activities.
Storm was apprehended in late August 2023, while co-founder Semenov was designated on OFAC’s Specially Designated Nationals list. The arrest was executed by the Federal Bureau of Investigation and the Internal Revenue Service’s Criminal Investigation Division in Washington, D.C. A US Department of Justice official voiced opposition to Storm’s retrial in late August.
This case has sparked significant criticism from the crypto community. In August, the pro-crypto US lobby group Blockchain Association expressed that Storm’s conviction could establish a “dangerous” precedent for developers and privacy. They emphasized that Storm did not control the crypto transiting through the protocol.
“Roman Storm developed privacy technology that functioned without his custody/control over Tornado Cash users’ funds. […] Tornado Cash operated as non-custodial software, ensuring users retained total control of their assets at all times.”
Related: Ethereum core developer ‘safe and free’ after being detained in Turkey
The crypto community leading the privacy fight
Bitcoin (BTC) and the broader cryptocurrency community originated from a pro-cryptography movement known as the cypherpunks. Although many in the crypto space now prioritize the financial aspects of blockchain technology, privacy continues to be a pivotal issue for the industry.
Last week, Ethereum co-founder Vitalik Buterin criticized the European Union’s proposed “Chat Control” legislation, warning that it jeopardizes the right to privacy in digital communications. The legislation would mandate messaging platforms to implement client-side pre-encryption scanning of content for illicit material.
“You cannot secure society by making individuals insecure,” Buterin argued. He also pointed out that backdoors created for law enforcement are “inevitably hackable” and compromise the safety of all.
Some experts view this as a regulatory misalignment that could lead users to alternative ungoverned web3 solutions. Hans Rempel, co-founder and CEO of Diode, expressed to Cointelegraph that the law represents a dangerous overreach, asserting that “providing an inherently corruptible entity with nearly limitless visibility into individuals’ private lives contradicts a sincere value statement on digital privacy.”
Magazine: Can privacy survive in US crypto policy after Roman Storm’s conviction?
