Samourai Wallet Founders Sentenced: Unlicensed CoinJoin Mixer
U.S. District Court has sentenced Samourai Wallet co-founders Keonne Rodriguez and William Lonergan Hill to four and five years in prison, respectively, for operating an unlicensed money transmission business through their non-custodial CoinJoin mixer, Whirlpool. Prosecutors argued that Samourai Wallet’s service routed and coordinated ‘Ricochet’ mixes via its servers without FinCEN registration, facilitating money laundering.
This ruling reinforces the DOJ’s position that non-custodial models alone do not exempt operators from money-transmitter regulations, echoing the earlier Tornado Cash cases. Since Samourai’s shutdown in September 2024, developers have launched Ashigaru, an open-source mixer aiming for full decentralization to avoid similar legal risks.
Traders should note that intensifying DOJ enforcement on privacy tools could heighten regulatory scrutiny across the sector, potentially impacting liquidity and market sentiment around privacy coins and mixer services.
Bearish
The sentencing of Samourai Wallet’s founders signals heightened DOJ enforcement against unlicensed mixing services, which could dampen demand for privacy tools and related tokens. In the short term, traders may see increased risk aversion toward privacy coins like XMR and projects offering mixer functionality. Over the long term, stricter regulatory scrutiny may discourage development and usage of such services, reducing transaction volumes and liquidity in this niche segment. This combination of legal risk and market uncertainty supports a bearish outlook for privacy-focused assets.