DOJ Shifts Focus: Code Without Criminal Intent No Longer Target

The U.S. Department of Justice (DOJ) has signaled a significant shift in its enforcement approach toward open-source software developers in the cryptocurrency sector, asserting that "merely writing code without ill intent is not a crime" [1]. The remarks were delivered by Matthew J. Galeotti, acting assistant attorney general of the DOJ’s Criminal Division, during a public event hosted by the American Innovation Project in Wyoming [2]. This statement reflects a departure from prior enforcement strategies under the Biden administration and marks a new era in how the DOJ will handle cases involving software developers of decentralized technologies.

Galeotti emphasized that while the DOJ will continue to pursue individuals who knowingly facilitate crimes such as money laundering, fraud, or sanctions evasion, it will no longer prioritize prosecuting developers who contribute to open-source projects without criminal intent [3]. His comments follow the high-profile conviction of Tornado Cash co-founder Roman Storm, who was found guilty of conspiracy to operate an unlicensed money transmitting business but received a deadlocked jury on more serious charges like money laundering and sanctions evasion [4]. Galeotti specifically stated that new charges under 18 U.S.C. § 1960 would not be approved if the software is truly decentralized, automates peer-to-peer transactions, and does not give a third party custody or control over user assets [5].

The clarification comes amid broader regulatory shifts under the Trump administration, which has sought to position the U.S. as a global leader in the crypto industry. This includes the recent dismantling of the National Cryptocurrency Enforcement Team, a move that aligns with Galeotti’s assertion that the DOJ should not use federal criminal statutes to impose regulatory frameworks on digital assets [6]. The administration’s stance is also influenced by the belief that previous enforcement practices under the Biden administration created an uncertain legal environment for innovation in the crypto sector.

Industry experts and legal analysts have interpreted the DOJ’s statements as a potential turning point for developers and startups working on decentralized technologies. Katie Biber, chief legal officer at Paradigm, noted that the DOJ is reinforcing the idea that criminal laws must provide clear notice of what is illegal and that innovating in the space of value storage and transmission should not be considered a criminal act in itself [7]. Jake Chervinsky, chief legal officer at Variant Fund, argued that the DOJ’s remarks provide grounds to overturn Storm’s conviction, stating that the case exemplifies a situation where charges should not have been brought against a developer who lacked the intent to facilitate crime [8].

The impact of this policy shift is expected to be multifaceted. On one hand, it may encourage greater investment and innovation in open-source crypto projects, as developers now have clearer legal boundaries. On the other hand, it does not eliminate all risks—developers who maintain control over user assets or who are found to have knowingly facilitated illegal activities will still face potential legal consequences. The DOJ’s framework also underscores the importance of governance and operational design in determining liability, suggesting that decentralized governance and time-locked mechanisms can mitigate legal exposure [9].

As the DOJ moves forward with this new enforcement strategy, the crypto industry will likely continue to monitor how it is applied in real-world cases. The agency’s decision to focus on intent and actual criminal conduct rather than the mere existence of code is a nuanced but significant step toward balancing innovation and regulation in the rapidly evolving digital asset landscape.

Source:

[1] US DOJ hands crypto privacy developers win, clarifying that code isn’t a crime (https://www.mitrade.com/insights/news/live-news/article-3-1062328-20250822)

[2] US DOJ says 'writing code' is not a crime, signaling shift in ... (https://cryptobriefing.com/doj-shipping-code-not-a-crime-crypto-open-source/)

[3] DOJ: stop incriminating crypto developers without intent (https://en.cryptonomist.ch/2025/08/22/doj-stop-incriminating-crypto-developers-without-intent/)

[4] US DOJ to back off money transmitter cases in shift ... (https://www.reuters.com/sustainability/boards-policy-regulation/us-doj-back-off-money-transmitter-cases-shift-backed-by-crypto-2025-08-21/)

[5] U.S. Justice Department Official Says Writing Code Without ... (https://www.coindesk.com/policy/2025/08/21/u-s-justice-department-official-says-writing-code-without-bad-intent-not-a-crime)

[6] Crypto Code Creators Safe: DOJ Eases Regulations On ... (https://www.mitrade.com/insights/news/live-news/article-3-1059724-20250822)