The Tornado Cash trial has reached a critical juncture, holding significant implications for developers of noncustodial Bitcoin and crypto technology, as well as privacy-preserving software. Amanda Tuminelli, executive director and chief legal officer for the DeFi Education Fund, has closely followed the proceedings, offering insights into the legal framework surrounding the case. She provided an overview of the charges against Tornado Cash co-founder Roman Storm, particularly focusing on the conspiracy to operate an unlicensed money transmitting business charge. Tuminelli, an expert on 18 U.S. Code § 1960, the federal law prohibiting unlicensed money transmitting businesses, argued that Storm had not violated this statute in creating and operating Tornado Cash, an Ethereum-based crypto mixing service. The broader discussion also included the CLARITY Act and the Blockchain Regulatory Certainty Act (BRCA), both of which contain provisions designed to protect developers of "non-controlling" (noncustodial) crypto technology, stipulating they do not require a money transmitting license.

Furthermore, Tuminelli highlighted concerns about the Department of Justice’s (DoJ) shift away from its 2019 FinCEN guidance, suggesting this could stifle innovation in the crypto space and potentially lead to further prosecutions of developers like Storm. This concern persists despite a prior memo from U.S. Deputy Attorney General Todd Blanche indicating the DoJ would cease targeting crypto entities, including mixing services, for the actions of their end users. The DeFi Education Fund has actively engaged by submitting amicus briefs in both the Tornado Cash and Samourai Wallet cases, though the brief for the former was rejected by the court.

The Tornado Cash trial has now concluded, with Roman Storm found guilty on the second count of his indictment: conspiracy to operate an unlicensed money transmitting business. This verdict, delivered by a jury in the Southern District of New York (SDNY) after three and a half days of deliberation, carries a potential sentence of up to five years in prison. The jury did not reach a unanimous verdict on the other two counts, which included conspiracy to commit money laundering and conspiracy to violate sanctions.

Following the verdict, the prosecution's motion to remand Storm into custody, citing him as a flight risk, was rejected by Judge Failla. The defense successfully argued that Storm had little incentive to flee, given his $2 million bail bond secured by his Washington state home, his family ties in the U.S. (including partial custody of his daughter and his girlfriend’s presence), and the continued support from the U.S.-based crypto community. Judge Failla acknowledged that while Storm's incentives had shifted, the