Alexey Pertsev, developer of Ethereum-based crypto mixer Tornado Cashwas sentenced to 64 months in prison after a Dutch court found him guilty of money laundering on Tuesday.
The judge said the platform was “aimed at criminals” and Pertsev should have been wary of the criminal origins of the transactions.
This widely followed case represents a blow to defenders of financial confidentiality. Many critics say Pertsev is being unfairly targeted as a developer of an open source platform.
Additionally, they claim he had no control over how users chose to use Tornado Cash to hide transaction history on the public blockchain.
Nonetheless, prosecutors successfully argued that Pertsev did too little to prevent the mixer from being used for money laundering.
They rejected claims that its obligations were reduced due to the decentralized nature of the platform's operations.
Experts predict this will have a chilling effect on the development of open source tools enabling anonymity on Bitcoin and other blockchains. They argue that this sets a precedent in holding developers responsible for the actions of anonymous users.
Tornado Cash was sanctioned by the US Treasury Department in 2022 over allegations that it concealed funds stolen by North Korean state hackers. Pertsev was arrested days later, dealing a blow to the embryonic cryptocurrency privacy sector.