Roman Storm Guilty of Unlicensed Crypto Money Transmission Charge

Roman Storm, co-founder of Tornado Cash, was found guilty on August 6, 2025, in a Manhattan federal court of conspiracy to operate an unlicensed money transmitting business, a charge that could carry a maximum sentence of five years in prison [1]. The case, brought by the U.S. Department of Justice (DOJ), centered on the role of Tornado Cash, a decentralized crypto mixer accused of facilitating over $1 billion in illicit transactions, including millions linked to the North Korea-affiliated Lazarus Group [2]. Prosecutors argued that despite being a noncustodial platform, Storm retained the ability to modify the code and restrict criminal use, but chose not to [4].

The jury, however, reached a partial mistrial on two additional charges—conspiracy to commit money laundering and violations of U.S. sanctions—failing to reach a unanimous decision after four days of deliberation [2]. This outcome has left open the possibility of future prosecutions related to those counts. A sentencing date has yet to be scheduled, and the court remains undecided on when the next steps in the judicial process will take place [3].

Storm’s legal defense highlighted that Tornado Cash is open-source software and that developers cannot be held criminally liable for how users choose to deploy such tools [3]. They presented expert witnesses, including Ethereum developer Preston Van Loon and privacy specialist Matthew Edman, to reinforce the argument that software code should not be treated as a financial instrument subject to traditional financial regulations [5]. The defense also emphasized that Storm did not anticipate or condone the misuse of Tornado Cash by malicious actors, further distinguishing him from direct involvement in illicit activities [3].

The ruling has drawn sharp criticism from parts of the crypto and DeFi community. Advocacy groups, including the DeFi Education Fund and Coin Center, have expressed concern that the prosecution could establish a precedent that threatens the development of open-source technologies [3]. Vitalik Buterin, co-founder of Ethereum, publicly supported Storm, underscoring the importance of privacy-preserving tools in the digital economy [5]. The Blockchain Association warned that the verdict could have a chilling effect on innovation in decentralized finance [5].

Storm has signaled his intent to appeal, calling the guilty verdict “bullshit” in remarks reported by journalist Eleanor Terrett and quoting Donald Trump’s “fight, fight, fight” mantra [3]. Whether Trump will offer any intervention, as he did with Silk Road founder Ross Ulbricht earlier this year, remains uncertain [3].

The case highlights the increasing scrutiny faced by DeFi infrastructure, particularly tools designed to enhance user privacy. While the DOJ has signaled a growing willingness to hold developers accountable for the misuse of their platforms, the split jury also reflects ongoing legal ambiguity regarding the liability of creators in decentralized systems [5]. The outcome may shape future regulatory strategies, particularly concerning the enforcement of money transmission laws in the context of noncustodial protocols [3].

The conviction of Roman Storm follows similar guilty pleas from the co-founders of Samourai Wallet, another privacy-focused crypto mixer, in early August 2025 [3]. These developments suggest a broader government strategy to target tools that enable anonymous transactions, especially those that complicate the traceability of funds in financial crime investigations [5].

Source:

[1] https://www.businessinsider.com/tornado-cash-roman-storm-trial-partial-mistrial-2025-8

[2] https://www.bloomberg.com/news/articles/2025-08-06/tornado-cash-co-founder-storm-guilty-in-crypto-laundering-case

[3] https://www.theblock.co/post/364948/tornado-cash-creator-roman-storm-found-guilty-on-money-transmitting-charge-but-not-guilty-on-sanctions-charge-inner-city-press

[4] https://www.coindesk.com/policy/2025/08/06/roman-storm-guilty-of-unlicensed-money-transmitting-conspiracy-in-partial-verdict

[5] https://www.dlnews.com/articles/defi/storm-jurors-reach-split-verdict-in-criminal-trial/