6 months ago
Three blockchain advocacy groups person filed amicus curiae briefs connected April 5 to support Tornado Cash developer Roman Storm from transgression charges successful the US.
The filings enactment Storm’s question to disregard the charges against him and contiguous respective arguments to guarantee developers are protected from specified ineligible action.
The Blockchain Association said the government’s lawsuit has a “critical flaw,” and its adoption could person “adverse repercussions” for the crypto industry.
The group’s caput of legal, Marisa Tashman Coppel, asserted that the government’s attraction of Tornado Cash arsenic an unlicensed wealth transmitter is unfounded. Under 18 USC § 1960 & FinCEN regulations, wealth transmitters indispensable person wholly autarkic power implicit idiosyncratic assets.
She said:
“Without the quality to independently determination funds connected a user’s behalf, 1 cannot beryllium a wealth transmitter.”
Tornado Cash and the developers bash not person power implicit funds due to the fact that the protocol is self-executing and immutable. Users alternatively support power implicit their assets, which are held successful pools managed by non-custodial astute contracts.
CoinCenter weighs in
CoinCenter’s Director of Research, Peter Van Valkenburg, said the US government “wrongly charged the Tornado Cash developers with transgression conspiracy.”
Like the Blockchain Association, Valkenburg and CoinCenter minimized developers’ relation successful Tornado Cash’s operations by referring to the platform’s astute contract-based pools.
Valkenburg besides explained however Tornado Cash’s bundle tools and UI are non-essential, meaning that the defendants did not execute transactions, comingle assets, person funds, oregon supply concealed notes — adjacent if the level was utilized for those purposes.
He compared Tornado Cash to TurboTax, which provides users with a utile mode to bash taxes but cannot record and wage taxes connected their behalf.
CoinCenter besides precocious ineligible arguments supporting bundle work arsenic escaped code and supporting statutory exemptions for informational transactions. It compared Tornado Cash to SWIFT, stating that some platforms should beryllium escaped from nonstop sanctions due to the fact that each lone handles information.
DeFi Education Fund
The DeFi Education Fund argued that developers should not beryllium held liable erstwhile a 3rd enactment uses their bundle for transgression activity.
The group’s Chief Legal Officer, Amanda Tuminelli, explained that the US authorities has ne'er utilized a peculiar statute, the International Emergency Economic Powers Act (IEEPA), successful a comparable way.
In implicit 100 different caller cases surveyed by the DeFi Education Fund, the authorities accused the suspect of interacting with a sanctioned counterparty. However, developers of platforms similar Tornado Cash bash not person immoderate specified counterparties.
Motion to dismiss
Storm and his lawyers initially filed a question to disregard the transgression charges connected March 29. The amicus curiae filings from each advocacy radical explicitly enactment that motion.
It is not yet wide whether the question for dismissal volition succeed, arsenic the lawsuit is inactive successful its aboriginal proceedings. The US Department of Justice charged Roman Storm successful August 2023, and helium volition stay connected bail until his September trial.
The US Department besides charged different Tornado Cash developer, Roman Semenov, alongside Storm. Semenov’s determination is unknown.
The US Treasury and OFAC sanctioned Tornado Cash successful August 2022, alleging that the level has laundered implicit $7 cardinal of crypto since 2019. It linked a fraction of that enactment to the North Korean state-sponsored radical Lazarus Group.
The station Tornado Cash developer gets assistance successful tribunal from blockchain advocacy groups appeared archetypal connected CryptoSlate.
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