Roman Storm’s Trial for Tornado Cash Money Laundering Set for December in New York

• Roman Storm’s trial for Tornado Cash-related money laundering will begin on December 2 in New York after a judge’s ruling.
• The defense argued that Tornado Cash development was protected by the First Amendment, but the court rejected this claim.
• Tornado Cash has been linked to major cryptocurrency laundering incidents, intensifying concerns over its use by cybercriminals.

The trial of Roman Storm, a developer of the Tornado Cash cryptocurrency protocol, will begin on December 2 in New York. A federal judge rejected Storm’s defense, which claimed that developing the Tornado Cash code was protected under the First Amendment. This ruling allows prosecutors to move forward with charges against Storm for money laundering and sanctions evasion.

The U.S. Department of Justice (DOJ) alleges that Storm laundered over $1 billion through Tornado Cash. Authorities also claim Storm has connections to North Korea’s Lazarus Group, which has been involved in large-scale cybercrime and cryptocurrency theft. These accusations further intensify the scrutiny surrounding the Tornado Cash platform and its potential use by criminals.

Judge Rejects Tornado Cash Free Speech Argument

Roman Storm’s defense team argued that developing Tornado Cash was an expression of free speech. They claimed that writing computer code falls under the protections of the First Amendment. However, U.S. District Judge Katherine Failla disagreed, stating that while code may have expressive elements, using it for specific functions such as facilitating illegal transactions removes it from the realm of protected speech. 

This ruling highlights a critical legal stance that creating technology, even in the form of code, can be subject to regulation if it is used in a manner that violates the law.

Tornado Cash and Recent Cybercrime Incidents

Tornado Cash has garnered attention for its ability to obscure cryptocurrency transaction trails, making it attractive to those who prioritize privacy. However, it has also become a tool for cybercriminals to launder illicit funds. U.S. authorities have identified Tornado Cash as a primary vehicle used by hackers, particularly those affiliated with North Korea, to conceal their activities.

Recently, hackers laundered $27 million in Ethereum through Tornado Cash, bypassing efforts to recover the stolen funds. Another separate incident saw $6.5 million in Ethereum laundered through the platform, raising further concerns over its continued use in cybercrime.

Legal and Industry Reactions to the Decision

Storm’s legal defense also contended that Tornado Cash is an immutable protocol, which operates independently of Storm’s control. Judge Failla, however, ruled that control over the protocol is not a prerequisite for the charges against Storm. She emphasized that Tornado Cash operates similarly to other crypto-mixing services that have been classified as money-transmitting businesses in prior legal cases.

The ruling has triggered significant concern among legal professionals and the wider cryptocurrency industry. Some experts warn that this decision could have broad implications for software developers. Amanda Tuminelli of the DeFi Education Fund expressed disappointment, while Jake Chervinsky from Variant emphasized that this ruling could impact the future of software development in the crypto space.