Co-founders of Tornado Cash has asked for the dismissal of money laundering charges against them

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Roman Storm, co-founder of the cryptocurrency mixer Tornado Cash, has filed a motion to dismiss all three charges against him related to allegations of operating a money laundering business and violating the International Emergency Economic Powers Act. Storm’s lawyers argued that the charges are “fatally flawed” and should be dismissed because there was allegedly little Storm could have done to prevent sanctioned entities from using the crypto mixer.

In a filing made on March 29 in the United States District Court for the Southern District of New York, Storm’s legal team contended that Tornado Cash was developed and publicly available before it was utilized by hacking groups sanctioned by the U.S. Department of the Treasury. As a result, Storm purportedly had limited ability to prevent sanctioned entities from utilizing the platform by the time of the alleged misconduct.

The charges revolve around accusations that Tornado Cash facilitated the efforts of the North Korean Lazarus Group in bypassing U.S. sanctions, allegedly allowing the regime to fund its nuclear program. Storm’s lawyers argued that Tornado Cash did not function as a money-transmitting business as it did not charge a fee for transmitting funds, and users retained sole control over their cryptocurrency.

Asserting that Storm aimed to develop software solutions to provide financial privacy for law-abiding cryptocurrency users, his legal team claimed that the charges are baseless and should be dismissed.

Storm previously pleaded not guilty to all charges in September 2023 and was released on a $2 million bond following his arrest. He is subject to restrictions on travel outside specific areas of New York, New Jersey, Washington, and California.

The motion to dismiss comes amid the U.S. government’s continued crackdown on crypto-mixing services. In March, the founder of Bitcoin Fog, a $400 million crypto-mixing service, was convicted of money laundering.

Despite legal challenges faced by crypto mixers, the crypto community recognizes their value in providing increased privacy and confidentiality for legitimate reasons, such as anonymous business transactions. However, efforts to support Storm’s legal defense, including a proposed allocation of funds from the Arbitrum DAO, were ultimately abandoned for undisclosed reasons.

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