DOJ Drops Part of Case Against Tornado Cash Developer, Trial Continues

The U.S. Department of Justice (DOJ) has announced that it will continue to pursue its case against Roman Storm, the developer of Tornado Cash, despite a recent policy memo issued by the department. The trial, scheduled for July, will focus on allegations that Storm knowingly transmitted funds tied to crimes, conspired to commit money laundering, and conspired to violate sanctions law. The DOJ has decided to drop part of one count against Storm, which alleged that he failed to comply with money transmitter business registration rules, in accordance with the April 7 memo authored by Deputy Attorney General Todd Blanche. This memo directed prosecutors not to pursue cases where regulations may be unclear or did not meet certain criteria, aiming to end "regulation by prosecution."

The memo's impact on the Storm case is evident, as it has led to the dismissal of part of one count against the defendant. However, the DOJ's decision to continue pursuing the case demonstrates its resolve to hold individuals accountable for their actions, even in the face of changing legal landscapes. The trial is expected to shed light on the legal and ethical implications of cryptocurrency mixing services and serve as a test case for how the DOJ intends to enforce its policies in the rapidly evolving world of digital currencies.

Brian Klein of Waymaker LLP, who represents Storm, believes that the case should never have been brought and that its dismissal would be consistent with the policies of the Trump Administration and the principles outlined by the DOJ in its recent cryptocurrency guidance memo. Klein argues that Storm's prosecution is a threat to the entire crypto industry and that the interests of justice will be best served by its swift dismissal. He also raised the defense that coding, or typing out code, is given free speech protections, similar to writing a book or engaging in other expressive activities.

The DOJ's decision to proceed with the case against Roman Storm underscores the importance of regulatory oversight in the cryptocurrency industry. It sends a clear message that the department is committed to upholding the law and ensuring that digital currencies are used responsibly. As the trial approaches, all eyes will be on the courtroom to see how this landmark case unfolds and what implications it may have for the future of cryptocurrency regulation. The case will be closely watched by industry stakeholders, legal experts, and the public, who are eager to see how the legal system will address the challenges posed by new technologies.