Tornado Cash: Co-founder seeks dismissal of charges after court ruling
The case of Tornado Cash, the cryptocurrency mixing platform that has sparked intense debates about privacy and regulation, has gained a new chapter. Roman Storm, one of the platform’s co-founders, is seeking to have the charges against him dropped following a landmark court ruling that questioned the legality of sanctions imposed on the software.
Tornado Cash has been subject to sanctions by the US Treasury Department, alleging that the platform was used for money laundering, including by groups such as Lazarus, which is linked to North Korea. The situation has led to the arrest of developers and sparked a wave of debate about the responsibility of open-source software creators.
Now, with a twist in the case, Roman Storm sees a possible acquittal. In a motion Filed on December 18, Storm’s defense argues that the Fifth Circuit’s recent decision is crucial to the case. That decision concluded that the Office of Foreign Assets Control (OFAC), an agency within the U.S. Treasury, exceeded its powers in sanctioning Tornado Cash’s immutable smart contracts.
It is worth remembering that the three judges of the Court of Appeals for the Fifth Circuit highlighted in decision : “We find that Tornado Cash’s immutable smart contracts (the lines of software code that enable privacy) are not ‘property’ of a foreign national or entity, meaning they cannot be blocked under IEEPA and OFAC has overstepped its congressionally defined authority.”
The core of the Fifth Circuit’s decision is its recognition that standalone software, which is not controlled by any entity, cannot be classified as property. This legal interpretation has direct implications for Storm’s case, since the prosecution’s case was based on the premise that he controlled Tornado Cash and was therefore liable for its activities.
Storm’s motion argues that the Fifth Circuit’s decision “makes clear that there is no deliberate action that Mr. Storm could have taken here.” In other words, the defense claims that because the software operated autonomously, Storm had no way of controlling its use and, consequently, cannot be held liable for any unlawful activities carried out through the platform.
Furthermore, the defense argues that “the developers’ lack of control over the proceeds renders them legally incapable of conspiring to commit money laundering and negates the knowledge element of a money laundering charge.” Thus suggesting that even if Tornado Cash was used for illicit purposes, Storm had no knowledge or control over these actions.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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