Feds Drop 5-Year Charge Against Tornado Cash Co-Founder Roman Storm
Tornado Cash co-creator Roman Storm was indicted in October 2023 by the DOJ for operating an unlicensed money transmitting business under the Bank Secrecy Act, carrying up to five years in prison. His indictment targeted the mixer’s failure to register Tornado Cash as a money services business. In a recent reversal, the DOJ announced it will not pursue prosecution on the money transmission count, citing legal ambiguities in applying the statute to decentralized protocols. Storm remains charged with money laundering under 18 U.S.C. §1956. This decision highlights evolving regulatory enforcement in the crypto sector and offers traders new clarity on compliance risks for Ethereum-based mixers.
Neutral
The DOJ’s decision to drop the unlicensed transmission charge reduces legal uncertainty without fully absolving key allegations. While removing a major five-year penalty may ease short-term compliance fears, the remaining money laundering count maintains regulatory pressure. Historically, mixed enforcement signals lead to muted market responses. In the long term, clearer guidelines for Ethereum-based mixers could support project stability, but ongoing laundering scrutiny keeps risk balanced.