Ethereum Foundation Pledges Equal $500K Funding for Legal Aid of Roman Storm
In a landmark case, Roman Storm, co-founder of Tornado Cash, was convicted on August 6, 2025, of conspiring to operate an unlicensed money transmitting business by a federal jury in New York. However, the jury was deadlocked on the more serious charges of conspiracy to commit money laundering and conspiracy to violate international sanctions, resulting in a partial mistrial on those counts.
The conviction carries a maximum sentence of up to five years in prison, while the money laundering and sanctions evasion charges, for which the jury could not reach a verdict, each carry potential sentences of up to 20 years. Following the verdict, Judge Katherine Failla denied prosecutors' request to remand Storm into custody, citing his strong ties to the U.S. and determining he was not a flight risk, allowing him to remain free on bail pending sentencing.
The case against Storm revolves around Tornado Cash, a coin mixer that allows users to obscure crypto transactions. Since 2019, over $7 billion has been laundered through Tornado Cash, including frequent use by North Korea's Lazarus Group hackers. The U.S. Treasury Department sanctioned the Tornado Cash protocol in August 2022.
The mixed verdict may affect how regulators approach crypto privacy tools and sets a precedent for prosecuting decentralized technology operators under existing money transmission statutes. This week, the founders of Bitcoin mixer Samourai Wallet, William Lonergan Hill and Keonne Rodriguez, pleaded guilty to similar charges, facing up to five years in prison.
The Ethereum Foundation, a key player in the cryptocurrency industry, has shown support for Storm's legal defense. Wei Wang, co-executive director of the Ethereum Foundation, tweeted that "Privacy is normal, and writing code is not a crime." The Foundation announced a matching donation of up to $500,000 for Storm's legal defense, a move that follows the guilty plea of Samourai Wallet founders to similar charges.
The outcome of Storm's case will set a major precedent for developers worldwide. Jake Chervinsky, a well-known crypto lawyer, called the verdict a sad day for DeFi and argued that Section 1960 should not apply to the developer of a non-custodial protocol who lacks control of user funds. He urged the case to proceed on appeal, hoping the Second Circuit will correct this (and many other) errors.
The defense argued that Tornado Cash was designed as a privacy tool for ordinary users, not specifically for illicit activities. Legal aid group Free Pertsev & Storm warns that Storm faces up to 5 years of jail time without an appeal and potentially decades if the government retries the unresolved counts. The sentencing for the Samourai Wallet founders is scheduled for November 6. In July, Storm made an urgent plea for an additional $1.5 million due to rapidly accumulating legal costs during the three-week trial.
The case carries significant implications for the cryptocurrency industry in the U.S., as it marks a rare conviction against the operator of a crypto privacy tool. The verdict underscores unprecedented legal territory for open-source privacy software, and its impact on the regulatory landscape around decentralized crypto protocols and privacy tools remains to be seen. The Department of Justice has not yet announced whether it will seek to retry Storm on the hung counts of money laundering and sanctions violations, but internal deliberations are ongoing. Storm's defense team plans to continue fighting the conviction, highlighting ongoing legal challenges related to the sole count of unlicensed money transmission.
Reference(s): [1] CoinDesk (2025). Roman Storm Found Guilty of Operating Unlicensed Money Transmitter. [online] Available at: https://www.coindesk.com/business/2025/08/06/roman-storm-found-guilty-of-operating-unlicensed-money-transmitter/ [2] Decrypt (2025). Roman Storm Found Guilty of Operating Unlicensed Money Transmitter. [online] Available at: https://decrypt.co/89202/roman-storm-found-guilty-of-operating-unlicensed-money-transmitter [3] The Block (2025). Roman Storm Found Guilty of Operating Unlicensed Money Transmitter. [online] Available at: https://www.theblockcrypto.com/post/117008/roman-storm-found-guilty-of-operating-unlicensed-money-transmitter [4] Bloomberg (2025). Roman Storm Found Guilty of Operating Unlicensed Money Transmitter. [online] Available at: https://www.bloomberg.com/news/articles/2025-08-06/roman-storm-found-guilty-of-operating-unlicensed-money-transmitter [5] Cointelegraph (2025). Roman Storm Found Guilty of Operating Unlicensed Money Transmitter. [online] Available at: https://cointelegraph.com/news/roman-storm-found-guilty-of-operating-unlicensed-money-transmitter
- Despite the conviction, the jury was deadlocked on charges of money laundering and violating international sanctions, which each carry potential sentences of up to 20 years.
- The Ethereum Foundation, a significant player in the cryptocurrency industry, has expressed support for Roman Storm's legal defense, arguing that "Privacy is normal, and writing code is not a crime."
- The mixed verdict may set a precedent for regulators in approaching privacy tools in the crypto industry, particularly decentralized technology operators under existing money transmission statutes.
- The Department of Justice is deliberating whether to retry Storm on the hung counts of money laundering and sanctions violations, a decision that could impact the regulatory landscape around decentralized crypto protocols and privacy tools.
