NEW - The Criminalization of Privacy: Tornado Cash Guilty Verdict Analysis 🏛️ @coincenter Executive Director @valkenburgh in conversation with @frankcorva on the @rstormsf conviction + implications for financial surveillance and open source development. 00:00 - Introduction 01:48 - Legal Analysis - Unlicensed Money Transmission 06:01 - Appeal Prospects 11:48 - Samurai Developers' Plea Deal Legal Implications 15:50 - Jurisdictional Reach of the Southern District of New York 22:51 - Blockchain Regulatory Certainty Act (BRCA) 27:55 - Surveillance Concerns in President's Working Group Report 38:17 - Support from SEC Commissioner Hester Peirce 42:04 - Digital Identity and the Future of Privacy in Crypto 45:16 - Closing Remarks on Roman Storm

Got a good question about if an appeal in the Storm trial will reopen questions about the immutability of the pool contacts or other factual disputes about control. I don't think so:

Some thoughts on peanut butter, watermelon, and the importance of financial privacy:

bold and correct on the 1960 law. glad he's in good spirits.

Coin Center’s Seven Takeaways from the Storm Verdict: ▪️ 1. The sole conviction—unlicensed money transmission (18 U.S.C. § 1960)—turns mainly on legal/regulatory interpretation (“does this count as money transmission?”), not jury fact-finding. ▪️ 2. The court, at the motion-to-dismiss stage, discounted FinCEN’s stated guidance on what counts as “money transmission” in crypto and treated the category as broader than “control of customer funds.” ▪️ 3. With “money transmission” defined that broadly, the jury’s room to decide facts was narrow; the court’s interpretation largely dictated the outcome. ▪️ 4. DOJ’s prior “end regulation by prosecution” memo didn’t fully resolve §1960 issues left things open for continued prosecution; the DOJ dropped the failure-to-register theory but not the “knowingly transmitting criminal funds” theory. Coin Center’s view: both hinge on “transmitting” and are improper against developers excluded by FinCEN guidance. ▪️ 5. The BRCA (Blockchain Regulatory Certainty Act), now attached to CLARITY and passed by the House, would confirm that non-controlling developers aren’t money transmitters. It can’t help Roman retroactively, but the Senate should pass it in upcoming market-structure debates. ▪️ 6. Coin Center fellow Michael Lewellen is suing DOJ for a declaration that publishing/maintaining his software isn’t unlicensed money transmission. Coin Center will continue supporting this effort to correct the legal interpretation. ▪️ 7. Coin Center is sorry Roman faces sentencing on a theory that contradicts the regulator’s guidance. He should appeal the denial of his motion to dismiss; Coin Center will assist however possible.

Coin Center’s Seven Takeaways from the Storm Verdict: ▪️ 1. The sole conviction—unlicensed money transmission (18 U.S.C. § 1960)—turns mainly on legal/regulatory interpretation (“does this count as money transmission?”), not jury fact-finding. ▪️ 2. The court, at the motion-to-dismiss stage, discounted FinCEN’s stated guidance on what counts as “money transmission” in crypto and treated the category as broader than “control of customer funds.” ▪️ 3. With “money transmission” defined that broadly, the jury’s room to decide facts was narrow; the court’s interpretation largely dictated the outcome. ▪️ 4. DOJ’s prior “end regulation by prosecution” memo didn’t fully resolve §1960 issues left things open for continued prosecution; the DOJ dropped the failure-to-register theory but not the “knowingly transmitting criminal funds” theory. Coin Center’s view: both hinge on “transmitting” and are improper against developers excluded by FinCEN guidance. ▪️ 5. The BRCA (Blockchain Regulatory Certainty Act), now attached to CLARITY and passed by the House, would confirm that non-controlling developers aren’t money transmitters. It can’t help Roman retroactively, but the Senate should pass it in upcoming market-structure debates. ▪️ 6. Coin Center fellow Michael Lewellen is suing DOJ for a declaration that publishing/maintaining his software isn’t unlicensed money transmission. Coin Center will continue supporting this effort to correct the legal interpretation. ▪️ 7. Coin Center is sorry Roman faces sentencing on a theory that contradicts the regulator’s guidance. He should appeal the denial of his motion to dismiss; Coin Center will assist however possible.nition of money transmission?"rather being primarily determined by factual questions that the jury decides.

This is why I was so angry last Winter. The court's legal reasoning to deny the motion to dismiss at the time basically said that money transmission includes anyone who facilitates the movement of tokens on chain, and that the FinCEN guidance for who must license is irrelevant. Once you rule on that, the jury doesn't have much left to do. The legal ruling was wrong. Needs to be appealed.

He was found guilty on the charge that directly contradicts FinCEN's guidance. Unbelievable.

So it sounds like no verdict on money laundering (gov't could possibly re-prosecute). Guilty on conspiracy to transmit money, and not guilty on conspiracy to evade sanctions. Happy about 1 and 3. The money transmission charge was inappropriate from the start and the way the legal rulings went down last winter may have doomed the outcome with a jury that can only find facts. This needs to be appealed, and Coin Center will do everything to make sure the judge gets the law right the next time around.

Tea leaf reading but FYI in NY (and under the sixth amendment) you need unanimity for a guilty verdict.