Three blockchain advocacy groups filed a court brief on April 5th to protect Tornado Cash developer Roman Storm from criminal charges in the United States.
The filing supports the motion to dismiss the charges against Mr. Storm and lays out several arguments to ensure the developer is protected from such legal action.
The Blockchain Association said the government’s lawsuit had “serious flaws” and its adoption could have “adverse effects” on the cryptocurrency industry.
Marisa Tashman Koppel, the group’s legal director, said the government’s treatment of Tornado Cash as an unauthorized money transfer company is baseless. Pursuant to 18 USC § 1960 and FinCEN regulations, money transmitters are required to maintain complete independent management of user assets.
she said:
“You cannot be a sender without the ability to independently transfer funds on behalf of a user. ”
Tornado Cash and its developers have no control over the funds as the protocol is self-executing and immutable. Instead, users maintain control of their assets held in a pool managed by non-custodial smart contracts.
CoinCenter is involved
Peter Van Valkenburgh, head of research at Coin Center, said the U.S. government had “unjustly accused the developers of Tornado Cash of criminal conspiracy.”
Similar to the Blockchain Association, Valkenburg and CoinCenter minimized the role of developers in the operation of Tornado Cash by referring to the platform’s smart contract-based pools.
Mr. Falkenberg also cited how Tornado Cash’s software tools and UI were non-essential, meaning the defendants did not execute trades, commingle assets, receive funds, or provide confidential memos. I also explained that. Even if the platform is used for those purposes.
He compared Tornado Cash to TurboTax. TurboTax provides you with a convenient way to pay your taxes, but we cannot pay taxes on your behalf.
CoinCenter also advanced legal arguments supporting software publishing as free speech and legal immunity for information transactions. The magazine compared Tornado Cash and SWIFT and said that both platforms should not be directly sanctioned because they only handle information.
DeFi Education Fund
The DeFi Education Fund argued that developers should not be held responsible if a third party uses their software for criminal activities.
Chief Legal Officer of the Group; Amanda Tuminelliexplained that the U.S. government has never used a specific law, the International Emergency Economic Powers Act (IEEPA), in a comparable manner.
In more than 100 other recent cases investigated by the DeFi Education Fund, governments have accused defendants of interacting with sanctioned counterparties. However, developers of platforms like Tornado Cash have no such counterparty.
motion to dismiss
Storm and his attorney originally filed a motion to dismiss the criminal charges on March 29. Amicus briefs from advocacy groups clearly support this claim.
Since the case is still in its early stages, it is not yet clear whether the motion to dismiss will be successful. The U.S. Department of Justice will indict Roman Storm in August 2023, and he will remain free on bail until his trial in September.
Along with Storm, the US Department of State also indicted another Tornado Cash developer, Roman Seminov. Semenov’s whereabouts are unknown.
The US Treasury and OFAC sanctioned Tornado Cash in August 2022 for laundering more than $7 billion in cryptocurrencies since 2019. The company linked some of its activities to North Korea’s state-run group Lazarus Group.
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