Tornado Cash Dev Roman Storm Set For Trial As Court Rejects Motion To Dismiss

In a significant legal case, Tornado Cash co-founder Roman Storm will now face a legal trial after the US court rejected a motion to dismiss several charges filed against the defendant by the US Department of Justice. This development comes a year after the DOJ announced an indictment against Storm and fellow Tornado Cash developer Roman Semenov.

According to US authorities, Storm and Semenov are two of three persons who created, promoted, and operated Tornado Cash, a digital platform that has facilitated over $1 billion in money laundering profit for several criminals including prominent syndicates such as the Lazarus Group. For context, Tornado Cash is a popular decentralized cryptocurrency protocol that mixes multiple assets to obscure the transaction trail of these funds. It has been previously employed by hackers in siphoning ill-gotten gains. 

In response to the charges against him, Roman Storm filed a motion to dismiss claiming an infringement of his First Amendment rights among other arguments. In a telephonic conference on September 26, US Judge Katherin Polk Failla of the Southern District of New York struck out Storm’s request meaning the blockchain developer will be subject to a full-scale legal trial. 

According to Chief Legal Officer at DeFi Education Fund, Amanda Tuminelli, Judge Failla explains that, in contrast to previous arguments made by the defendant’s lawyers, maintaining control of the transactions on Tornado Cash is not a requirement to run a money-transmitting business according to Section 1960 of the US Constitution. The US Judge described Tornado Cash as not dissimilar from other money-transmitting businesses. 

Furthermore, Failla states that Storm’s defense which backs the creation of Tornado Cash as a form of free speech via coding is fallible as the “functional capability” of code as a speech is not stated under the First Amendment Rights Act. In conclusion, Katherin Failla clearly stated that the matters raised by Storm’s lawyers are factual issues that should undergo a trial.  The US Judge said:

To the extent Storm is asking me to decide a controverted issue of fact, I am not able to do that.

Following Judge Falia’s decision, Roman Storm is now set for trial on December 2 in New York.  Storm and Semenov are charged with one count of conspiracy each to commit money laundering, operate an unregistered money-transmitting business, and violate the International Economic Emergency Powers Act. Each party could be subject to a cumulative 45-year imprisonment sentence if found guilty.

While Roman Storm is in DOJ’s custody following his arrest in August 2023, Semenov remains at large with whereabouts unknown by authorities. Meanwhile, Alexey Pertsev, the third co-founder of Tornado Cash has been sentenced to five years in prison by Dutch authorities following his indictment in 2022.

Featured image from Bloomberg, chart from Tradingview