Tornado Cash Developer Roman Storm to Face Trial in December

TLDR

• Roman Storm’s motion to dismiss charges denied by Judge Katherine Polk Failla
• Storm faces trial in December on three federal charges related to Tornado Cash
• Judge ruled government prosecutors have plausible allegations against Storm
• Storm could face up to 45 years in prison if convicted on all charges
• Case raises concerns about implications for software developers’ freedom

Roman Storm, a developer and co-founder of the cryptocurrency mixer Tornado Cash, is set to face trial in December after a New York district court judge denied his motion to dismiss criminal charges brought by the United States government.

Judge Katherine Polk Failla ruled on September 26 that federal prosecutors had presented plausible allegations against Storm, rejecting his bid to toss three federal charges.

Storm, along with fellow co-founder Roman Semenov, was charged in August 2023 with conspiracy to commit money laundering, conspiracy to commit sanctions violations, and conspiracy to operate an unlicensed money-transmitting business.

These charges stem from their involvement with Tornado Cash, a platform designed to enhance privacy in cryptocurrency transactions.

During a telephone conference, Judge Failla stated she

“cannot simply accept Mr. Storm’s narrative that he is being prosecuted merely for writing code.”

The judge emphasized that she was convinced Tornado Cash was different from other financial services or money-transmitting firms.

Failla also noted the Justice Department’s accusation that Tornado Cash received nearly $1 million in funding from a venture capital firm with the expectation of profit-sharing, suggesting that “the platform was not an altruistic venture.”

Storm, who has pleaded not guilty to the charges, had argued in his March dismissal bid that Tornado Cash was open-source software and not under his control.

He positioned himself as a developer who created software “to provide financial privacy to legitimate cryptocurrency users.” However, prosecutors contested this characterization, alleging that Storm “reaped millions of dollars in profits” while knowing the platform was being used for illicit money laundering.

The case has sparked debate within the cryptocurrency community about the implications for software developers.

Jake Chervinsky, chief legal officer of crypto venture firm Variant, expressed strong criticism of the ruling on social media platform X (formerly Twitter), calling it “an assault on the freedom of software developers everywhere” and predicting that it would “go down on appeal, if that’s what it takes.”

Judge Failla’s ruling denying @rstormsf‘s motion to dismiss the indictment is an assault on the freedom of software developers everywhere.

This will go down in history as a perversion of law and a travesty of justice.

And it will go down on appeal, if that’s what it takes.

— Jake Chervinsky (@jchervinsky) September 26, 2024

If convicted on all three charges, Storm faces a maximum possible sentence of 45 years in prison. His trial is scheduled to begin on December 2.

The Tornado Cash case has already seen legal action in other jurisdictions. In May, Alexey Pertsev, the third co-founder of Tornado Cash, was found guilty of laundering $1.2 billion through the platform by the Netherlands ‘s-Hertogenbosch Court of Appeal. Pertsev was sentenced to five years and four months in prison and is preparing to appeal his conviction.

Meanwhile, Roman Semenov, a Russian national and the other co-founder charged alongside Storm, remains at large.