Roman Storm, a founder of Tornado Cash, has been found guilty of operating an unlicensed financial business that helped facilitate over $1 billion in illegal transactions.
Court Verdict and Charges
The Southern District of New York announced the verdict after a four-week trial led by Judge Katherine Polk Failla. Storm avoided more serious charges of money laundering and sanctions violations because the jury could not reach a unanimous decision on those issues, resulting in a partial mistrial. Storm could face a maximum sentence of five years.
During the trial, evidence showed that he was one of the three founders of Tornado Cash, helping develop its main features and financing important infrastructure.
Implications for the DeFi Community
Prosecutors pointed out that Storm continued to use Tornado Cash even after learning it was handling illegal funds, including a substantial sum linked to the infamous Ronin hack attributed by the FBI to North Korea's Lazarus Group.
US Attorney Jay Clayton highlighted the importance of accountability in the crypto space, noting that while digital assets hold significant potential, they must not be used to conceal criminal activities. The verdict has raised concerns within the DeFi community, as many see it as a risky precedent for developers of privacy tools and open-source crypto systems.
Future of Crypto Regulation
Legal experts like Jake Chervinsky, Chief Legal Officer at Variant, expressed disappointment over the ruling, calling it a "sad day for DeFi." Chervinsky stated that the case should not have been pursued, arguing that Section 1960 should not apply to developers of non-custodial protocols that do not manage user funds. He recommended appealing the case, hoping that higher courts would correct any errors in the ruling.
The outcome of Storm's trial raises significant questions about how cryptocurrency will be regulated in the future and how developers will be treated in the rapidly evolving DeFi landscape.
The final verdict in Roman Storm's case raises important questions regarding the current and future regulation of cryptocurrencies and the potential implications for developers in the decentralized finance sector.
