New York – Prosecutors told a federal judge on Friday before the open court that they planned to invoice criminal certain employees of the venture capital company of Crypto Dragonfly Capital, including general partner Tom Schmidt, for their investment in 2020 in the Tornado in cash of Tornado Tornado.
The discussion BetWeen Prosecutor Nathan Rehn and District Judge Katherine Polk Failla of the Southern District of New York (SDNY) Came Amid A Break in the Nailing Trial of Tornado Cash Developer Roman Storm, Who has been charged with conspiracy to commit money laundering, conspiracy to operate UnliceNSED Money Transmitting Business and Conspiracy to Violate International Sanctions for His Work With the Privacy Tool – Charge for Which, If Found Culpable, he faces up to 45 years in prison.
During their case, the accusation introduced a series of messages between Storm and two Capital partners of Dragonfly, Schmidt and his director Haseeb Qureshi. In the context of the case of government, the messages seemed to be used for several purposes: establishing an appropriate place in New York (because Schmidt is based in Manhattan), to show that Storm and his colleagues took advantage of Tornado Cash and to show that they have made frequent modifications to the front interface or to the user interface of the product.
However, when the Storm defense team raised the possibility of asking Schmidt to testify – likely to provide a context for his messages and Storm and to explain the justification of the company to invest in tornado constraints in the defense of Storm.
“Perhaps you are looking to continue everyone in Dragonfly?” Failla asked Rehn on Friday.
“Everyone, but Schmidt” and another individual, said Rehn, according to Inner City Press.
The government then asked the judge to seal this part of the transcription of the discussion at the Court, which she agreed to do.
Qureshi went to X Friday to defend his business’s investment in the torade in cash, writing:
“We are deeply believing in the right of Americans to privacy, and its absence remains one of the greatest unresolved problems in the crypto. We do not support our investment. We have not operated or exercised control over the Tornado Cash, we have had no contact with malicious users, we have always encouraged our portfolio companies to follow the law, and we have argued that Tornado Cash itself has a legitimate right to exist, “wrote the law. “The invoicing of a venture capital company for the alleged fault of a portfolio company would be unprecedented, in particular in these circumstances.”
Qureshi added that Dragonfly “entirely cooperated” with the government’s investigation into the Tornado Cash, which he said began in 2023.
“After all this time – years later – carrying charges against Dragonfly would be scandalous, unlike the facts, and would induce a scary effect on all investments in cryptography and confidentiality technologies in America,” said Qureshi. “We do not think that the Doj would really bring such absurd and baseless accusations. But if they do, we intend to defend ourselves vigorously. ”
