Tornado Cash Co-Founder Found Guilty in Manhattan Trial
Tornado Cash co-founder Roman Storm found guilty of unlicensed money transfers; partial mistrial leaves major crypto regulation questions unresolved.
Roman Storm, co-founder of the cryptocurrency mixing service Tornado Cash, was found guilty on August 6, 2025, by a federal jury in Manhattan. He was convicted of conspiring to operate an unlicensed money-transmitting business. However, for two more serious charges, Money laundering and sanctions violations, the jury was unable to decide. Consequently, the case resulted in a partial mistrial, and Storm now waits to be sentenced, which may be a maximum of five years in prison.
Tornado Cash Developer Convicted for Unlicensed Money Transfers
This trial has drawn keen interest in participation from the crypto world and lawyers. It betrays the increasing strain between open-source blockchain development and U.S. enforcement of regulations. According to Bloomberg, Storm was charged by prosecutors with enabling criminals such as the Lazarus Group of North Korea to launder over $1 billion in stolen crypto through Tornado Cash, as she had knowingly permitted them to do so. They labeled the venue as a “money laundering giant washing machine.”
It took the jury three days to come up with a unanimous verdict on only one count: operating an unlicensed money transmitting business. Brian Klein, the attorney of Storm, said he was relieved his client had not been found guilty on two other charges, which could spell decades behind bars. He said that Storm did not plan to assist criminals and stressed the idea that Tornado Cash was developed as a privacy tool but not a crime tool.
Indeed, although it is a part of the win of the defense, it receives a conviction. The evidence showed that competent prosecutors claimed that Storm and his co-founders would make Tornado Cash a product to make money through criminal activity. The Department of Justice estimated that criminals transferred $300 million in illicit funds through the platform. This amount included money stolen during the infamous Ronin hack. The North Korean Lazarus Group has been denominated by FBI as the group responsible in that hack. Officials added that Storm still operated the platform and transferred stolen funds even when the general knowledge confirmed the work of the Lazarus Group.
Related Reading: ZachXBT Identifies Lazarus Group Behind Bybit $1B Hack
Tornado Cash Processed $1B in Crime Funds, Say Prosecutors
Between 2020 and 2022, According to prosecutors, Tornado Cash handled more than $1 billion in criminal dealings. It is alleged that Storm and his co-founders made over 12 million dollars in profits out of the service. The government insisted that Storm had the knowledge of operating the service even after he was fully aware how the service was being illegitimately used.
Tornado Cash history also contributes to the complexity of the case. Storm, Roman Semenov and Alexey Pertsev started the platform in 2019 with the aim of assisting people to anonymize Ethereum transactions. Although it was popular due to issues of privacy, criminals also attracted it. In 2022, Tornado Cash was sanctioned by the U.S. Treasury expressly because of its activities assisting North Korea in laundering the stolen funds. Both Storm and Semenov were indicted on for several federal charges in 2023. Later on, Storm was posted on a 2-million dollar bond but Semenov is still at large.
In 2024, Dutch authorities imprisoned cofounder Alexey Pertsev. They accused him of laundering $1.2 billion. The court sentenced him to more than five years in prison.
His conviction created legal precedent, and it was used in the U.S. case against Storm.
In the future, the legal team of Storm will be appealing the conviction. The Department of Justice may review the unresolved charges and decide on a retrial. This case matters a lot for developers of decentralized platforms, especially those who build privacy tools. Many people in the crypto world are watching the outcome closely. The result may guide how the U.S. regulates digital privacy and open-source projects. It could also affect how developers create new crypto tools in the future.
The post Tornado Cash Co-Founder Found Guilty in Manhattan Trial appeared first on Live Bitcoin News.
Filed under: Bitcoin - @ August 7, 2025 3:30 pm