DOJ to Continue Pursuing Criminal Charges Against Tornado Cash Creator Roman Storm

The Department of Justice in the United States has decided to maintain its federal criminal charges against Roman Storm, co-founder and developer of Tornado Cash, as reported by Decrypt on May 15. This development comes despite an internal communication that hinted at a possible change in the agency’s approach toward cases involving cryptocurrency mixing services.

The DOJ’s resolution to move forward remains firm even after indications suggesting a shift in focus. Storm faces federal charges related to money laundering and evading sanctions.

Prosecutors claim that Storm conspired to launder money, avoid U.S. sanctions, and run an unauthorized money transmission operation via Tornado Cash, a mixer service built on Ethereum that aims to conceal the origins and destinations of cryptocurrency transactions.

Storm’s trial is scheduled to commence in a federal court in Manhattan in the coming months. Recent filings indicate that prosecutors have conceded to retract part of the charges concerning the unlicensed money transmitting operation due to inconsistencies with federal regulations.

In 2019, the Financial Crimes Enforcement Network (FinCEN) clarified that Tornado Cash and similar “non-custodial entities” do not fall under the category of money transmitters. The DOJ’s reevaluation emphasizes the ongoing friction between law enforcement and the creators of decentralized technology.

Amanda Tuminelli, who heads the DeFi Education Fund, remarked that technology developers creating neutral privacy solutions should not be subjected to “unreasonable criminal standards.” This perspective resonates with several industry leaders, including Ethereum co-founder Vitalik Buterin, who continues to extend his support to Storm.

The continuation of charges against Storm follows the release of an internal memo suggesting a strategic shift in the agency’s focus toward prosecuting individuals misusing cryptocurrency tools rather than targeting the platforms themselves.

This change has been viewed as a reflection of evolving attitudes under the more crypto-friendly administration. Nonetheless, the DOJ remains committed to pursuing the case against Storm.

In September, U.S. District Judge Katherine Polk Failla rejected his motion to dismiss, stating that utilizing computer code for money laundering does not receive protection under the First Amendment, countering Storm’s claims of free speech surrounding his code.

The U.S. Treasury Department imposed sanctions on Tornado Cash in 2022, asserting that the protocol facilitated over $7 billion in illegal transactions. However, in March, the Office of Foreign Assets Control quietly lifted Tornado Cash from its sanctions list following a federal appeals court decision stating that immutable smart contracts cannot be sanctioned as property.

Storm’s co-developer, Alexey Pertsev, was sentenced to more than five years in prison by a Dutch court last year but was later released under electronic monitoring in February as he awaits an appeal.

As of the latest update, neither the DOJ, Storm, nor his legal team have responded to requests for comments.