Feds reject Tornado Cash dev’s bid to overturn conviction

Key Takeaways

What is Roman Storm trying to do?

Tornado Cash developer Roman Storm filed a motion seeking judgment of acquittal after his conviction on charges of operating an unlicensed money transmitting business.

What does the government say about Storm’s defense?

Prosecutors dismissed Storm’s claim that Tornado Cash was merely “decentralized” code, calling it “decisively disproven at trial.”

U.S. prosecutors are pushing back hard against Tornado Cash developer Roman Storm’s attempt to overturn his conviction. They filed a sweeping 113-page brief that brands his defense arguments as “meritless” and contradicted by overwhelming trial evidence.

Storm was convicted in a four-week trial on charges of conspiring to operate an unlicensed money transmitting business that knowingly processed criminal proceeds. 

The jury heard testimony from 21 witnesses. They also reviewed over 400 government exhibits linking Storm to a sophisticated money laundering operation that mixed billions in cryptocurrency.

Government push back on “just code” defense

The filing, signed by former SEC Chair Jay Clayton—now U.S. Attorney for the Southern District of New York—systematically dismantles Storm’s central argument that he merely wrote open-source code with no control over how criminals used it.

Also, prosecutors revealed that Storm’s own expert witness admitted that Tornado Cash consisted of “multiple interlocking parts” beyond immutable smart contracts. 

Private chat messages showed Storm acknowledged their public “decentralization” narrative was false and that they maintained centralized control points.

“The defendant continues to claim that Tornado Cash was nothing more than a decentralized protocol,” prosecutors wrote. “That claim was decisively disproven at trial.”

$12 million in hidden profits

Evidence showed Storm went to extraordinary lengths to conceal his profits from operating Tornado Cash. 

He liquidated over $12 million in TORN governance tokens through a cryptocurrency account registered under a foreign national’s name. Also, he used pseudonyms to hide his financial gains from the mixing service.

Additionally, the government argued these hidden profits undermine Storm’s portrayal of Tornado Cash as an altruistic open-source project. 

“His substantial profits, cashed out under a pseudonym, were powerful evidence explaining his criminal intent,” prosecutors wrote. They note that criminal transactions “made up a substantial portion of his business.”

Ronin hack connection

The brief details how Tornado Cash processed hundreds of millions from North Korea’s Ronin Bridge hack. Also, it includes transactions that violated U.S. sanctions against the Lazarus Group. 

Furthermore, Storm allegedly maintained the service’s “relayer system” that facilitated these transactions even after being warned about sanctioned users.

The jury deadlocked on two additional counts: money laundering conspiracy and sanctions violations.

Although prosecutors maintain that the evidence was sufficient for conviction on all charges, the jury was unable to reach a verdict on these two counts.