Roman Storm, co-founder of Tornado Cash, was convicted on August 6, 2025, in New York for conspiracy to operate an illegal money transmitting business.
The guilty verdict highlights ongoing regulatory scrutiny on crypto privacy protocols, potentially impacting Ethereum and related tokens’ liquidity and user confidence.
Roman Storm Convicted for Unlicensed Business Operations
Roman Storm, co-founder of Tornado Cash, was found guilty of conspiracy to operate an unlicensed money transmitting business on August 6. The federal jury deadlocked on charges related to conspiracy to commit money laundering and sanctions violations.
The court ruling left Storm facing a potential five-year sentence, although he remains free on bail. He is noted for his role in developing Tornado Cash, a non-custodial privacy protocol on Ethereum, with no real-time statements reported post-verdict.
Verdict Sparks Debate on DeFi Regulation
Despite significant media attention, there is no indication of immediate financial impact on Tornado Cash or related assets such as Ethereum or TORN. Crucially, past regulatory measures have led to substantial shifts in user dynamics within the crypto community.
“The implications of this trial extend beyond just one individual; they touch on the very core of decentralized finance and developer liability.” – Preston Van Loon, Ethereum Core Developer
The verdict symbolizes growing regulatory scrutiny, with potential outcomes influencing future DeFi and privacy protocol operations. Thus far, there have been no public comments from involved regulatory agencies, and the community’s response remains unreported.
History of Crypto Mixer Crackdowns
Similar cases, such as the 2022 OFAC sanctions on Tornado Cash, have affected the DeFi space. Historical evidence shows crackdowns on crypto mixers, such as Blender.io and Bitcoin Fog, leading to significant user migration and market impact.
Kanalcoin experts suggest this ruling may spur deeper examination of privacy protocols under US regulations. The outcome could signal tougher compliance requirements, influencing how developers and users engage with open-source cryptocurrency projects in the future.
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