Three blockchain advocacy groups filed amicus curiae briefs on April 5 to defend Tornado Cash developer Roman Storm against criminal charges in the United States.
The documents support Storm's motion to dismiss the charges against him and present several arguments to ensure that developers are protected from such lawsuits.
The Blockchain Association said the government's case had a “critical flaw” and its adoption could have “negative repercussions” on the crypto industry.
The group's legal chief, Marisa Tashman Coppel, said the government's treatment of Tornado Cash as an unlicensed money transmitter was unfounded. Under 18 USC § 1960 and FinCEN, money issuers must have completely independent control over user assets.
She says:
“Without the ability to move funds independently on behalf of a user, one cannot be a money transmitter.
Tornado Cash and the developers have no control over the funds as the protocol is self-executing and immutable. Instead, users retain control of their assets, which are held in pools managed by non-custodial smart contracts.
CoinCenter weighs in
CoinCenter research director Peter Van Valkenburg said the U.S. government “falsely accused Tornado Cash developers of criminal conspiracy.”
Like the Blockchain Association, Valkenburg and CoinCenter have downplayed the role of developers in Tornado Cash's operations by referring to the platform's smart contract-based pools.
Valkenburg also explained that Tornado Cash's software tools and user interface are non-essential, meaning the defendants did not execute trades, commingle assets, receive funds, or provide secret notes, even though the platform was used for these purposes.
He compared Tornado Cash to TurboTax, which offers users a useful way to file their taxes, but cannot file and pay taxes on their behalf.
CoinCenter has also made legal arguments supporting the release of software as free speech and supporting legal exemptions for information transactions. He compared Tornado Cash to SWIFT, saying both platforms should be free from direct sanctions because each only deals with information.
DeFi Education Fund
The DeFi Education Fund argued that developers should not be held liable when a third party uses their software for criminal purposes.
The group's Legal Director, Amanda Tuminelliexplained that the U.S. government has never used a particular law, the International Emergency Economic Powers Act (IEEPA), in a comparable way.
In more than 100 other recent cases investigated by the DeFi Education Fund, the government accused the accused of interacting with a sanctioned counterparty. However, platform developers like Tornado Cash do not have such counterparties.
Motion to dismiss
Storm and his attorneys initially filed a motion to dismiss the criminal charges on March 29. Each advocacy group's amicus briefs explicitly support this request.
It is not yet clear whether the motion to dismiss will be successful, as the case is in its early stages. The US Department of Justice has indicted Roman Storm August 2023and he will remain free on bail until his trial in September.
The US department also charged another Tornado Cash developer, Roman Semenov, alongside Storm. Semenov's location is unknown.
The U.S. Treasury and OFAC sanctioned Tornado Cash in August 2022, alleging that the platform had laundered more than $7 billion in crypto since 2019. It linked a fraction of this activity to the North Korean state-sponsored group Lazarus Group.