Tornado Cash co-founder Roman Storm, found guilty on one felony count in August, may be closer to avoiding a possible retrial on additional charges following a statement from a Justice Department official.
Speaking at a Thursday summit in Wyoming organized by the cryptocurrency advocacy organization American Innovation Project, Matthew Galeotti, the acting assistant attorney general for the Justice Department’s criminal division, suggested that the department would be changing its approach to certain enforcement cases involving crypto and blockchain.
The DOJ official said his remarks were to offer clarity following an April memo from US Deputy Attorney General Todd Blanche, titled “Ending Regulation by Prosecution.”
Though not mentioning Storm by name, Galeotti mentioned issues similar to his criminal case, suggesting that the Justice Department would pursue “even-handed enforcement of the law,” including in some instances involving allegations of operating an unlicensed money transmitter business.
“Our view is that merely writing code, without ill intent, is not a crime,” said Galeotti. “Innovating new ways for the economy to store and transmit value and create wealth, without ill intent, is not a crime. The criminal division will, however, continue to prosecute those who knowingly commit crimes or who aid and abet the commission of crimes, including fraud, money laundering, and sanctions evasion.”
He added:
“The department will not use federal criminal statutes to fashion a new regulatory regime over the digital asset industry. The department will not use indictments as a law-making tool. The department should not leave innovators guessing as to what could lead to criminal prosecution.”
Galeotti’s statement did not necessarily mean that the US government would not pursue a retrial against Storm for conspiracy to commit money laundering and conspiracy to violate sanctions, charges on which a jury deadlocked in August. However, for a Justice Department official to speak openly about a change in enforcement policies at a cryptocurrency event could signal a different approach to criminal cases involving digital assets in the future.
“Where the evidence shows that software is truly decentralized and solely automates peer-to-peer transactions, and where a third party does not have custody and control over user assets, [new charges] will not be approved,” said Galeotti, citing the relevant law.
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Tornado Cash developer still in legal jeopardy after trial
Storm was indicted in the US in August 2023 for conspiracy to commit money laundering, conspiracy to operate an unlicensed money transmitter and conspiracy to violate US sanctions. He was found guilty of conspiracy to operate an unlicensed money transmitter following a four-week trial, while the jury deadlocked on the other two charges.
The Tornado Cash co-founder is expected to be sentenced for the single count soon, but no hearing has been filed on the court docket as of time of publication. Before and through the trial, Storm and his supporters in the crypto industry reiterated the claim that “writing code is not a crime” — remarks that Galeotti echoed on Thursday.
“If a developer merely contributes code to an open-source project without the specific intent to assist criminal conduct, aid or abet a particular crime, or join a criminal conspiracy, he or she is not criminally liable,” said Galeotti. “When it comes to criminal prosecution, involvement in the digital asset ecosystem should not and will not subject individuals to a different level of scrutiny.”
The law is technology-neutral […] the department is simplifying things to hold bad actors accountable while avoiding the prosecution of unwitting regulatory violations.”
“Roman Storm was just convicted on this exact charge under this exact circumstance,” said Variant chief legal officer Jake Chervinsky in a Thursday X post, referring to Galeotti’s statement. “Justice for Roman means dropping the case.“
The Justice Department guidance, suggesting that the US government would take a different approach to enforcement cases — potentially affecting developers like Storm — received cheers at the American Innovation Project summit. The nonprofit organization, aimed at educating policymakers and encouraging public advocacy on digital assets, launched on Tuesday.
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