Roman Storm, one of the co-founders of the controversial cryptocurrency mixer Tornado Cash, has entered a not guilty plea in response to charges of money laundering and violating US sanctions. This plea was made before a judge in the US District Court for the South ern District of New York, as reported on X (formerly known as Twitter) on September 6. Storm, alongside his alleged co-conspirator Roman Semenov, faces charges related to conspiracy to launder money, conspiracy to violate sanctions, and conspiracy to operate an unlicensed engulfed money transmission business.
The accusations revolve around "Tornado Cash," a company that purportedly aided North Korea's Lazarus Group in circumventing US sanctions. It is claimed that this assistance allowed the regime to fund its nuclear program. Following his arrest, Storm was released on a $2 million bond but has faced significant travel restrictions, limiting him to certain regions within New York, New Jersey, Washington, and specific parts of California.
In August 2022, Dutch authorities arrested Alexey Pertsev, another co-founder of Tornado Cash, on similar charges linked to money laundering by the Lazarus Group. Pertsev is scheduled to be released from prison in April 2023, at which point he will await trial while subject to electronic monitoring. As of now, Semyonov, the third co-founder, remains at large.
In August 2022, the US Treasury Department's Office of Foreign Assets Control added Tornado Cash to its list of Specially Designated Nationals (sanctioned entities), a move that sparked criticism both within and outside the cryptocurrency space. Many believed that this action extended beyond the agency's regulatory scope and authority. In September 2022, a lawsuit was filed against this decision, financially supported by cryptocurrency exchange Coinbase. However, in a ruling made in August, a judge sided with the US Treasury Department.
The allegations against the Tornado Cash co-founder have generated considerable debate within the cryptocurrency community. Ethereum co-founder Vitalik Buterin, for instance, publicly admitted to using mixers to send funds to individuals affected by Russia's invasion of Ukraine, which has been ongoing since February 2022.
