Tornado Cash Co-Founder Guilty of Unlicensed Crypto Business Charge

Generated by AI AgentCoin World
Thursday, Aug 7, 2025 8:26 am ET1min read
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Aime RobotAime Summary

- Roman Storm, Tornado Cash co-founder, was convicted of operating an unlicensed crypto business in a U.S. court on August 7, 2025.

- Prosecutors accused him of enabling North Korea’s Lazarus Group to launder $1B via Tornado Cash, while Storm denied criminal intent, emphasizing privacy protection.

- The partial acquittal on severe charges reflects legal uncertainty over developer liability for tool misuse, marking a historic but contested precedent in crypto law.

- Storm vowed to appeal, calling the conviction baseless, as the DeFi community faces mixed signals from U.S. regulatory scrutiny and evolving legal standards.

Roman Storm, co-founder of the decentralized finance (DeFi) protocol Tornado Cash, was found guilty on a single count of operating an unlicensed money-transmitting business in a U.S. court on August 7, 2025. The jury, however, was deadlocked on more severe charges related to sanctions violations and money laundering, which were brought by the U.S. Department of Justice (DOJ). Prosecutors alleged that Storm enabled North Korea’s Lazarus Group to launder over $1 billion through Tornado Cash, claiming he was aware of the risks and ignored them. Storm denied the charges, arguing that his work was about protecting financial privacy and was not inherently criminal [1].

The conviction marks a historic moment as the first time a U.S. court has criminally convicted a crypto developer for writing code that facilitates financial privacy. While the guilty verdict sets a legal precedent, the jury’s failure to convict on the more serious charges suggests a nuanced view within the legal system, indicating that not all are convinced that developers bear responsibility for how their tools are used by others [2].

Storm’s legal team emphasized that the developer had not been a criminal but had built software intended for privacy. His attorney, Brian Klein, described the conviction as baseless and pledged to fight the charges. Storm himself vowed to “fight, fight, fight,” echoing Donald Trump’s rhetoric, and expressed confidence in overturning the guilty verdict [3].

The outcome has sent mixed signals to the DeFi community and open-source developers. On one hand, it highlights the U.S. government’s growing scrutiny of privacy-centric crypto tools; on the other, the partial acquittal offers a reprieve, suggesting that the legal landscape remains uncertain and evolving. Legal expert Jake Chervinsky noted that the case represents a “sad day for DeFi,” but the retrial of the more serious charges and potential appeals offer hope for a reversal [4].

Storm will now face sentencing for the single count on which he was convicted. U.S. Attorney for the Southern District of New York, Jay Clayton, praised the prosecution’s efficiency in securing the conviction, but the judge denied a motion to jail Storm, stating there was “a lot of fighting left in this case” [5].

The ruling comes amid a broader surge in crypto markets, with major assets like

Ethereum
and
Solana
rising on news of a potential executive order allowing crypto in 401(k) plans. Analysts, including Tom Lee of BofA, have suggested higher price targets for Ethereum, further reinforcing the sector’s optimism despite regulatory headwinds [6].

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Source:

[1] (https://decrypt.co/333946/morning-minute-tornado-cash-developer-found-guilty-partially)