Court Grants Alexey Pertsev Release Under Monitoring

Regulatory scrutiny over the cryptocurrency industry continues as two high-profile legal cases move forward. Tornado Cash developer Alexey Pertsev has been released from Dutch prison under electronic monitoring as he prepares to appeal his money laundering conviction. Meanwhile, former Celsius CEO Alex Mashinsky has requested a delay in his sentencing, citing the need for additional time to prepare his defense following his guilty plea. 

Tornado Cash Developer Alexey Pertsev Released from Dutch Prison Amid Legal Battle

Alexey Pertsev, the developer behind the controversial Tornado Cash protocol, has been released from prison following a Dutch court’s decision to suspend his pretrial detention. However, his release comes with strict conditions, including electronic monitoring, as he prepares to appeal his money laundering conviction.

Pertsev, who has been detained in the Netherlands since August 2022, expressed mixed emotions about his release. In a statement on X on Feb. 6, he noted that while he is no longer physically behind bars, his current circumstances do not equate to “real freedom.”

“A Dutch court suspended my pretrial detention under the condition of electronic monitoring. This will give me a chance to work on my appeal and fight for justice,” he wrote.

The court’s decision marks a significant development in a case that has sparked global debate about the criminal liability of software developers in the cryptocurrency space. Pertsev, a Russian national and resident of the Netherlands, was convicted of money laundering on May 14, 2024, and sentenced to five years and four months in prison. His legal team filed an appeal immediately following the conviction.

Pertsev’s case has raised concerns within the crypto and tech communities, particularly about the legal responsibilities of developers creating privacy-focused tools. Tornado Cash is an open-source, non-custodial crypto mixing protocol designed to enhance transaction privacy on the blockchain by obscuring the origin and destination of funds.

However, regulators and law enforcement agencies have long claimed that the protocol has been widely used for illicit purposes, including money laundering and sanctions evasion. The Dutch court determined that Pertsev and his Tornado Cash co-founders should have implemented more robust measures to prevent criminal use of the platform.

During his trial, Pertsev argued that he could not be held responsible for how users chose to utilize the software. The court, however, rejected this defense, aligning with the view that Tornado Cash’s design inherently facilitated illicit transactions.

Despite these legal setbacks, Pertsev has gained support from privacy advocates and crypto developers, many of whom see the prosecution as an attack on financial privacy and open-source development.

Pertsev’s case is not an isolated incident. In August 2023, the United States charged Tornado Cash co-founders Roman Storm and Roman Semenov with aiding in laundering over $1 billion in cryptocurrency, allegedly linked to cybercrime and sanctioned entities.

While Storm was released on a $2 million bond and is expected to face trial in April, Semenov remains at large and is currently on the FBI’s most wanted list. The charges against them stem from accusations that Tornado Cash facilitated money laundering operations by groups such as North Korean hacking collective Lazarus Group.

The US crackdown intensified in August 2022 when the US Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Tornado Cash, effectively blacklisting its smart contracts. This decision was highly controversial, as it marked one of the first times that US authorities had imposed sanctions on a piece of open-source code rather than a specific entity or individual.

However, on Jan. 21, 2025, a US court overturned the OFAC sanctions, a ruling seen as a significant win for the crypto community. The decision reignited debates over the criminalization of privacy tools and whether the US government had overstepped its authority in sanctioning the protocol.

The Tornado Cash case has set a worrying precedent for software developers working on privacy-enhancing and decentralized technologies. Many fear that creating open-source software could expose developers to criminal liability, even if they have no control over how the software is used.

What’s Next for Pertsev?

Despite his release, Pertsev’s legal battle is far from over. His appeal will be closely watched, as it could have significant implications for the future of privacy tools, crypto regulation, and software development.

As he prepares for his appeal, the global crypto community remains divided. Privacy advocates and decentralization proponents argue that prosecuting developers like Pertsev stifles innovation and limits financial freedom. Meanwhile, regulators maintain that such tools, if left unchecked, enable illicit financial activities on an unprecedented scale.

For now, Pertsev remains under strict electronic monitoring, his movements closely watched as he builds his legal defense. Whether his appeal succeeds or not, one thing is clear: the Tornado Cash case is a defining moment in the ongoing battle between financial privacy and government oversight in the digital age.

Former Celsius CEO Alex Mashinsky Seeks Sentencing Delay Amid Legal Battles

Former Celsius CEO Alex Mashinsky has filed a request to delay his sentencing hearing, originally scheduled for April 8, 2025, as he continues to navigate multiple legal challenges stemming from his role in the collapse of the Celsius Network.

In a Feb. 5 filing in the US District Court for the Southern District of New York (SDNY), Mashinsky’s legal team petitioned for the hearing to be postponed by one month, from April 8 to May 8. His lawyers cited the complexity of the case and the necessity for additional time to prepare a sentencing submission that accurately reflects the former CEO’s position on his conduct.

“The defense wants to ensure that it has sufficient time to prepare a sentencing submission that accurately presents Mr. Mashinsky’s views on his offense conduct, along with the many other factors to be considered by the Court in weighing an appropriate sentence,” the filing stated.

However, US prosecutors have objected to the request, underscoring the urgency of providing justice to victims of Celsius’ collapse. The court has yet to rule on the delay request.

Mashinsky’s sentencing will mark one of the final chapters in a legal saga that began when Celsius Network, once a multi-billion-dollar crypto lending platform, collapsed in mid-2022. US authorities charged Mashinsky in 2023 with seven felony counts, including securities fraud, wire fraud, and manipulating the price of Celsius’ CEL token.

Facing mounting evidence, Mashinsky pleaded guilty to two of the charges in December 2024, effectively avoiding a full trial. The details of the plea deal remain undisclosed, but his cooperation with authorities could factor into his sentencing.

As part of the ongoing criminal case, US prosecutors have submitted victim impact statements to the court—documents that could influence the final sentence. These statements, typically written by those who lost money in Celsius’ collapse, will play a crucial role in determining the severity of Mashinsky’s punishment.

In addition to criminal proceedings, Mashinsky remains entangled in bankruptcy litigation, further complicating his legal situation. His legal team argued that juggling both cases has stretched his resources, justifying the request for additional time.

Mashinsky is not the only Celsius executive facing legal consequences. The company’s former chief revenue officer, Roni Cohen-Pavon, pleaded guilty to four felony charges in September 2023. His sentencing hearing is expected to follow Mashinsky’s, though no date has been set.

It remains unclear whether Cohen-Pavon will face prison time, but his involvement in Celsius’ alleged fraud scheme suggests that he may receive a significant sentence.

The case against Celsius executives is part of a broader crackdown on crypto fraud, as regulators and law enforcement aim to hold industry leaders accountable for financial misconduct.

Crypto’s Legal Reckoning: How Does Mashinsky Compare to Other Convicted Executives?

Mashinsky’s sentencing follows a pattern of crypto executives facing serious legal consequences for mismanagement and fraud. Some of the most high-profile figures in the space, including Sam Bankman-Fried (FTX) and Changpeng Zhao (Binance), have already faced the consequences of regulatory scrutiny.

• Sam Bankman-Fried (FTX) – The former CEO of FTX, once one of the largest crypto exchanges, was convicted of fraud and money laundering. He remains incarcerated, facing potential decades-long sentencing.

• Changpeng Zhao (Binance) – The founder and former CEO of Binance pleaded guilty to violating US anti-money laundering laws. However, unlike Mashinsky or Bankman-Fried, Zhao secured a relatively lenient sentence of just four months.

Mashinsky’s sentencing could fall somewhere between these two extremes. Given the severity of the fraud allegations, he is likely to receive a longer sentence than Zhao but may not face as harsh a punishment as Bankman-Fried.

The judge overseeing the case must now decide whether to grant Mashinsky’s request for a delay. If approved, his sentencing would take place in May 2025, giving his legal team extra time to prepare arguments that could potentially reduce his sentence.

However, if the court denies the request, Mashinsky will face sentencing on April 8 as originally scheduled.

Regardless of the outcome, the case signals a stronger stance by regulators and prosecutors against fraudulent practices in the crypto industry. Mashinsky’s sentencing will serve as a key test of how harshly the legal system punishes financial crimes in the digital asset space.