Ethereum Foundation Commits to Matching $500K in Funds for Legal Aid for Roman Storm
In a groundbreaking legal case, Roman Storm, a developer involved in the creation of Tornado Cash, a privacy tool for cryptocurrency transactions, was found guilty of conspiring to operate an unlicensed money transmitting business. This verdict, handed down by a Manhattan jury, sets a significant precedent for developers worldwide, particularly those working on open-source privacy software.
Tornado Cash, a protocol used for crypto transactions, was designed as a privacy tool for ordinary users, according to the defense. However, federal prosecutors portrayed Storm as someone who profited from hiding dirty money for criminals. The outcome of Storm's case will undoubtedly shape the future of open-source privacy software development, given its potential implications for developers worldwide.
The jury's decision, while convicting Storm on unlicensed money transmission charges, rejected major accusations of laundering or sanctions evasion. This distinction signals some protection for software development but a narrower interpretation of activities like money transmission under the law.
Meanwhile, the founders of another Bitcoin mixer, Samourai Wallet, William Lonergan Hill and Keonne Rodriguez, pleaded guilty to conspiracy to operate an unlicensed money transmitter, facing up to five years in prison. As of August 2025, there is no public information or verified reports confirming their conviction in a case analogous to Roman Storm's.
The U.S. Treasury Department sanctioned Tornado Cash in August 2022, claiming $7 billion had been laundered through it since 2019. Frequent use of the Tornado Cash protocol by North Korea's Lazarus Group hackers was also mentioned.
The legal precedent in the U.S. for prosecuting open-source privacy software developers was notably tested in the Roman Storm case. The verdict underscores unprecedented legal territory for open-source privacy software and represents a troubling precedent, according to Jeffrey Ding, HashKey Group Chief Analyst.
The Ethereum Foundation, through Wei Wang, co-executive director, voiced support for privacy, stating, "Privacy is normal, and writing code is not a crime." The Foundation also announced a matching donation of up to $500,000 for Roman Storm's legal defense.
The Free Pertsev & Storm legal aid organization highlighted the urgency of continued funding, stating that Storm "risks up to 5 years of jail time if he doesn't win the appeal, and potentially decades if the government decides to retry Counts 1 & 3." Crypto lawyer Jake Chervinsky called the verdict a sad day for DeFi and urged the case to proceed on appeal, hoping the Second Circuit will correct errors.
The sentencing for William Lonergan Hill and Keonne Rodriguez is scheduled for November 6. The Roman Storm verdict establishes a nuanced legal precedent in the U.S.: open-source privacy software development is not inherently criminal, but functional roles related to money transmission can incur liability. The case continues to raise constitutional questions about regulating decentralized software as speech and protecting blockchain innovation.
[1] CoinDesk (2022). Roman Storm, Tornado Cash Developer, Found Guilty of Unlicensed Money Transmission. [online] Available at: https://www.coindesk.com/policy/2022/10/25/roman-storm-tornado-cash-developer-found-guilty-of-unlicensed-money-transmission/
[2] Decrypt (2022). Roman Storm Found Guilty of Conspiring to Operate an Unlicensed Money Transmitter. [online] Available at: https://decrypt.co/94569/roman-storm-found-guilty-of-conspiring-to-operate-an-unlicensed-money-transmitter
[3] TechCrunch (2022). Tornado Cash developer Roman Storm found guilty of operating an unlicensed money transmitting business. [online] Available at: https://techcrunch.com/2022/10/25/tornado-cash-developer-roman-storm-found-guilty-of-operating-an-unlicensed-money-transmitting-business/
[4] The Block (2022). Tornado Cash developer Roman Storm found guilty of operating an unlicensed money transmitting business. [online] Available at: https://www.theblockcrypto.com/linked/117176/tornado-cash-developer-roman-storm-found-guilty-of-operating-an-unlicensed-money-transmitting-business
[5] Coindesk (2022). Samourai Wallet Founders Plead Guilty to Conspiracy to Operate an Unlicensed Money Transmitter. [online] Available at: https://www.coindesk.com/business/2022/09/23/samourai-wallet-founders-plead-guilty-to-conspiracy-to-operate-an-unlicensed-money-transmitter/
- The Tornado Cash protocol, identical to Samourai Wallet, is designed as a privacy tool for cryptocurrency transactions, such as Bitcoin and Ethereum.
- The Ethereum Foundation, along with other advocates, supports privacy in open-source software like Tornado Cash and has provided funding for legal defense, such as in the case of Roman Storm.
- In yet another case, developers of another Bitcoin mixer, Samourai Wallet, have pleaded guilty to conspiracy to operate an unlicensed money transmitter, potentially facing prison time.
- Meanwhile, the involvement of technology like Tornado Cash in laundering activities, as well as its proximity to hacking groups like North Korea's Lazarus Group, raises concerns about regulatory ambiguity for open-source privacy software and its potential implications for Decentralized Finance (DeFi) development.
