Tornado Cash Developer Contests Allegations, Submits Motion to Dismiss Supported by Legal Reasoning

Roman Storm, the co-founder of the cryptocurrency mixer Tornado Cash, has filed a motion to dismiss all three allegations against him, asserting that he did not run a money laundering operation and did not breach the International Emergency Economic Powers Act.

In a submission to the United States District Court for the Southern District of New York on March 29, Storm’s attorneys contended that he cannot be charged with conspiring to launder money.

According to Storm’s legal representatives, Tornado Cash was created, became immutable, and was accessible to the public prior to its use by the hacking groups that were sanctioned by the U.S. Department of Treasury.

They claim that Storm had minimal ability to prevent a “sanctioned entity from using it” by the time the alleged violations took place.

Storm’s Tornado Cash Aided Lazarus in Evading Sanctions

The allegations against Storm center on the claim that Tornado Cash aided the North Korean Lazarus Group in circumventing U.S. sanctions, potentially allowing the regime to fund its nuclear program.

Storm’s legal team further argued that Tornado Cash did not function as a money-transmitting business since it did not impose a fee for transferring funds, and users maintained complete control over their cryptocurrencies.

They asserted that Storm’s goal was to create software solutions that provided financial privacy for law-abiding cryptocurrency users, claiming that the allegations are “fatally flawed and should be dismissed.”

In September 2023, Storm pleaded not guilty to all charges and was released on a $2 million bond shortly after his arrest.

He currently faces travel limitations, restricting him to specific areas in New York, New Jersey, Washington, and California.

This development occurs amid the U.S. government’s ongoing crackdown on crypto-mixing services.

Recently, the founder of Bitcoin Fog, a $400 million crypto-mixing service, was convicted of money laundering.

Roman Sterlingov was found guilty of money laundering, conspiracy to launder money, operating an unlicensed money-transmitting business, and violating the D.C. Money Transmitters Act.

Storm Requested Support Against Money Laundering Allegations

Earlier this year, Storm sought assistance from advocates for privacy rights in preparation for his forthcoming criminal trial.

At that time, Storm indicated that his legal team was formulating a robust defense for his September 2024 trial.

“Whether you’re [a] passionate developer like me involved with Web3 or simply care about software and privacy, this legal battle will impact you. This case will establish a significant precedent for years to come,” he stated.

In response, the Arbitrum DAO proposed the allocation of approximately $1.3 million worth of Arbitrum (ARB) tokens from the community wallet to support Storm.

However, the proposer has since withdrawn the proposal without providing any explanation.

A crowdfunding initiative on GoFundMe, aimed at raising legal fees for Storm and Pertsev, was canceled on February 16 due to a violation of the platform’s terms of service that could potentially expose GoFundMe, its employees, or users to risk or liability.

As reported, the U.S. Treasury has placed Tornado Cash on its Specially Designated Nationals list, effectively prohibiting Americans from utilizing this mixer.

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