According to a Cointelegraph report, Roman Storm, one of the co-founders of Tornado Cash, a popular privacy-focused cryptocurrency mixer, is currently facing charges related to money laundering and sanctions violations. Storm was arrested by U.S. authorities in August and has been released on bail pending trial.
According to Inner City Press, Storm pleaded not guilty in the U.S. District Court for the Southern District of New York on September 6. He, along with alleged co-conspirator Roman Semenov, are accused of conspiracy to commit money laundering, conspiracy to commit sanctions violations, and conspiracy to operate an unlicensed money-transmitting business.
The charges revolve around allegations that Tornado Cash facilitated the efforts of the North Korean Lazarus Group in bypassing U.S. sanctions, potentially enabling the regime to fund its nuclear program. Storm was released on a $2 million bond shortly after his arrest and is subject to strict travel restrictions within specific regions of New York, New Jersey, Washington, and California.
In a related case, Tornado Cash co-founder Alexey Pertsev was arrested in the Netherlands in August 2022 on similar charges. Pertsev was released from jail in April 2023 and is now awaiting trial under electronic monitoring.
As of the time of this publication, Roman Semenov remains at large.
The U.S. Treasury Department’s Office of Foreign Assets Control added Tornado Cash to its list of sanctioned entities in August 2022, a move that drew criticism from various quarters within the cryptocurrency community. In September 2022, individuals supported by crypto exchange Coinbase filed a lawsuit against this designation, but a judge ruled in favor of the U.S. Treasury in an August decision.
The case against the Tornado Cash co-founders has sparked intense debate within the cryptocurrency community. Ethereum co-founder Vitalik Buterin publicly acknowledged using the mixer to send funds to those affected by the Russian invasion of Ukraine, further complicating the perception of the allegations.
The trial is expected to draw significant attention from both the crypto industry and legal experts, as it delves into the complex intersection of privacy technology, financial regulations, and geopolitical implications.