8 hours ago
Blockchain developer Michael Lewellen has filed a suit against the US Department of Justice (DOJ), accusing the President Joe Biden medication of stifling innovation successful the crypto assemblage done overly wide interpretations of national money-transmission laws.
Lewellen’s suit centers connected his enactment with Pharos, a non-custodial protocol that facilitates trustless and transparent crowdfunding campaigns. Pharos enables users to excavation crypto for charitable causes oregon different projects without the engagement of intermediaries.
Lewellen described his determination to writer arsenic a basal against regulatory overreach successful a statement. He added:
“Today, I’m taking a basal against the Biden administration’s unjust crackdown connected crypto improvement […] This isn’t conscionable astir Pharos; it’s astir the aboriginal of cryptocurrency innovation successful America.”
Legal challenge
Lewellen argued that his non-custodial protocol, which helium likens to a instrumentality alternatively than a fiscal service, should not beryllium taxable to national money-transmitting laws.
Unlike accepted wealth transmitters specified arsenic Western Union oregon Venmo, Pharos does not control, direct, oregon person the funds being transferred. Instead, the bundle enables users to execute transactions independently, preserving privateness and reducing reliance connected intermediaries.
Lewellen claimed that the DOJ’s enforcement actions against developers of akin non-custodial protocols, specified arsenic Tornado Cash, show a troubling enlargement of national authority.
He added that these prosecutions deviate from longstanding guidance issued by the Financial Crimes Enforcement Network (FinCEN), which had antecedently indicated that non-custodial tools did not suffice arsenic wealth transmitters.
Lewellen besides stated:
“The DOJ’s wide mentation of wealth transmission laws threatens the quality to physique freely […] For excessively long, the Biden medication has utilized a deficiency of clarity to scare builders distant from caller exertion oregon unit them to permission the USA.”
Broader implications
The suit highlights the increasing friction betwixt US regulators and the crypto industry. Developers similar Lewellen reason that regulatory ambiguity drives innovation offshore, portion policymakers support that tighter oversight is indispensable to curb illicit enactment and support consumers.
Amanda Tuminelli, main ineligible serviceman astatine the DeFi Education Fund, praised Lewellen for advocating for bundle developers and called the suit “hero stuff.”
Meanwhile, Peter Van Valkenburgh, CEO of the non-profit Coin Center, said that the enactment supports Lewellen successful defending his close to people software.
The station Crypto developer sues DOJ implicit Biden-era regulatory crackdown appeared archetypal connected CryptoSlate.
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