New York, New York – Tornado Cash’s developer, money money laundering from Novel Storm is expected to start Manhattan on Monday morning, when lawyers and Storm prosecutors start selecting a jury to supervise the four -week Storm trial.
Storm was arrested in the state of Washington in 2023 and accused of conspiracy in order to commit money laundering, conspiracy in order to violate American sanctions and conspiracy in view a company of transmission of money without license – accusations which, in the event of a storm, bear a maximum combined sentence of 45 years in prison. The compatriot of Tornado Cash, a developer of Tornado Cash, Russian National Roman Semenov, faces the same accusations but remains in freedom. Another developer, Alexey Pertsev, was found guilty of money laundering in the Netherlands in 2024 and sentenced to five years in prison, which he is currently attractive.
At the heart of the Storm case is Tornado Cash, a cryptocurrency mixture service focused on privacy, which, according to the government, has been used to whiten more than a billion dollars of criminal products by bad players – including the Lazare group, North Korea, Storm hacking and its colleagues, which said a Blindyy. Storm lawyers, on the other hand, argue that it was simply an open-source and decentralized software developer with legitimate uses and preserving confidentiality which should not be held responsible for use by bad players.
“There will certainly be a very vigorous defense here that they were writing code and that [Tornado Cash] was designed for privacy – that some people may have benefited from it, but [Storm and his colleagues] Were not co-conspirators, “said Mark Bini, a partner of the Global Group for the Practice of Regulation and the Application of Reed Smith.” The mixers have been very controversial because they have been used by many people who do bad things, without any doubt, but the idea that some people would like to use them for confidentiality, it is a legitimate argument. It will make a fierce battle here. »»
The Storm trial has drawn the attention of many members of the cryptography industry, who have raised fears that, if Storm is found guilty, this could mean that the developers at the end (Challenge) space as a whole. A multitude of major players in the industry, including the paradigm investment company and the defense groups for non -profit organizations Coin Center and the DEDUCUS FUND, submitted friendly memories in the defense of Storm.
Others, however, were more reluctant to accept the defense of Storm’s privacy. The economy writer JP Koenig wrote in a blog article in 2024 that, if the storm prevails at the trial, it could “mean that anyone who wants to facilitate illegal activities would have a strong incentive to copy the tornado money, effectively transforming their operation into a` `Golem ” – an artificial being without death.”
The analytical company of the Swiss blockchain Global Ledger wrote in a blog post that there are, in general, “many more reasons why cybercriminals might want to use a mixing service than developers who legitimately want to obscure the movement of their personal funds.”
Changing winds
The Storm trial begins as the US government continues to revise its approach to cryptographic industry – in particular cryptographic regulations. Under the American president Donald Trump, the White House adopted a more friendly position towards the industry (which paid $ 130 million in the Congress races during the 2024 and at least $ 18 million elections to the Trump’s inaugural committee alone), cutting regulators and the application of the law to do the same.
Since Trump took office in January, the Securities and Exchange American Commission – which had taken a Bogeyman status under the former president Gary Gensler for his so -called “application by application” – formed a cryptographic working group adapted to the industry and abandoned a series of open cases and surveys on Crypto -Crypto companies. In a service note in April to the staff, the deputy prosecutor Todd Blanche ordered the US Ministry of Justice (Doj) The staff to “restrict” their concentration on cryptographic crime, asking them that the agency will no longer charge regulatory violations in cases involving the crypto.
Although some have hypothesized that prosecutors would decrease their case against Storm following Blanche’s note, the government has moved forward, dropping only one accusation. The prosecutors also chose to continue their file against Storm in March after the office of control of foreign assets of the US Treasury Department (OFAC) The implementation of the money from the tornado on its list of sanctioned entities, after a federal judge ruled that the agency could not sanction an intelligent contract.
“Frankly, I was a little surprised that it was going before after seeing this [Tornado Cash] Was withdrawn from the OFAC list, “said Bini.” We do not yet know proof of the government, but we have seen the Trump administration really away from this kind of regulatory type. And this seems to be the one on the edges of this because the plot to operate a business transmission company without license [charge] This seems to be the type of regulatory case that the administration may leave the company. »»
Storm
At a conference before the trial last week, the district judge Katherine Polk Failla from the South District of New York (Sdny) Judged that none of the parties could raise the sanctions of the OFAC – either that the tornado money was sanctioned in the first place, or that the sanctions were then deleted – during the Storm trial, arguing that it confuses the jury. Failla also judged that none of the parties could mention the outcome of a related civil affair, Van Loon against department of the Treasury.
Bini told Coindesk that Failla’s decision to keep the OFAC sanctions outside the trial is likely to help the government more than that of Storm.
If the defense was able to tell the jury that the SOFAC sanctions were abandoned later, Bini said: “I think you are more likely to have jurors say” I am not sure that it is illegal or not “. And if they are not sure, then the defendant is not guilty.
Bini said that, if the trial translates into a conviction, Failla’s decision has potential reasons for Storm lawyers.
“Defense can say:” Hey, we should have the right to present this to the jury, we believe that this is important proof “, he said. “This is the type of case where even if the government obtains a conviction as they usually do, there can really be legal infirmities.”
If the jury judges Storm guilty, Bini said that there could be another option beyond an appeal – a presidential forgiveness. Trump has forgiven a number of people in the cryptography industry since its entry into office in January, including the co-founders of the Bitmex and the founder of Silk Road, Ross Ulbricht.
“Let’s say that it leads to a conviction, that does not mean that the president may not be involved afterwards,” said Bini. “It’s a bit of a joker that we could see playing here if the case translates into a conviction.”
Friday, during a last conference before the trial, the Storm lawyers made a last effort to have the case reject after the government revealed that its theory of the place (Basically, the justification of the accusation to bring the case in the South District of New York) Articulated on three evidence – Storm texts to New York -based venture capital, the Storm interview with a Bloomberg journalist based in New York and the fact that a Pirate has accessed Tornado Cash in New York.
Failla finally ruled against the defense request, allowing the government’s file against Storm to proceed to the trial.
The following four weeks
The Storm trial, initially planned for two weeks, should take place a full month due to the number of witnesses in the case. The government alone told court that he planned to call more than 20 people to testify, including a pirate who used Tornado in cash, a so-called “victim” witness and a host of expert witnesses.
The selection of the jury should take two days, with opening arguments probably scheduled for Wednesday.
Storm has not yet indicated in both cases, if he will testify to his own defense, but Bini said that this could be of great help for his defense.
“I think there is a very good chance [Storm] will testify. If necessary, [he’s] will have to resist a really steep cross [examination]But it could be really powerful in a case like this, “said Bini.” The burden is the responsibility of the government, not [defense]But they might want to take a stand and tell their story to the jury. »»
