TLDR
Paradigm says Storm’s software role doesn’t meet legal standards for money transmission.
Jury must find Storm knowingly moved criminal funds to convict, Paradigm argues.
OFAC lifted Tornado Cash sanctions in March 2025; criminal case still active.
Ethereum Foundation donated $500K to Storm’s $2M legal defense fund.
Venture firm Paradigm has joined the legal battle over Tornado Cash by filing an amicus brief in support of Roman Storm. The co-founder of the cryptocurrency privacy tool is set to face trial on July 14 in New York. Paradigm warned that the case could affect how software is developed and distributed in the United States.
Roman Storm was charged in 2023 with conspiracy to commit money laundering and sanctions violations. Tornado Cash, a decentralized software protocol, was used to mix cryptocurrency transactions to preserve privacy. Prosecutors allege the service helped hide funds tied to illegal activity.
Paradigm Challenges Government’s Legal Interpretation in Roman Storm Case
Paradigm, a crypto investment firm, submitted an amicus curiae brief last Friday. In the filing, it said the U.S. government had wrongly classified Storm’s software development as money transmission.
According to Paradigm, “The Treasury Department has long recognized that developers who publish software are not money transmitters.” The firm stated that the charges are based on an incorrect understanding of federal law, existing FinCEN guidance, and court decisions.
The firm’s legal team wrote in a blog post that this case could affect developers across the tech and blockchain industries. They added that criminalizing open-source software development could raise broad legal and operational concerns.
Focus on Jury Instructions and Burden of Proof
Paradigm’s brief asked the court to clarify the legal standard the jury must follow during the trial. It argued that the jury must determine whether Storm knowingly transmitted funds and managed proceeds of a specific criminal origin.
“The jury must be correctly instructed that they cannot convict unless Roman Storm knew the specific funds transmitted were derived from criminal activity,” the filing said. This point relates to the legal threshold required in cases involving money laundering or conspiracy charges.
The firm said that if Storm only built and published software without managing funds or user activity, he should not be held responsible. The brief emphasized that the legal system must distinguish between creating technology and using it for illegal purposes.
Treasury Sanctions and Current Status of the Case
Tornado Cash was sanctioned by the U.S. Treasury’s Office of Foreign Assets Control (OFAC) in 2022. The sanctions were lifted in March 2025, but the criminal charges against Storm continue.
Last month, the government announced it would drop the charge of operating an unlicensed money-transmitting business. However, prosecutors still plan to pursue the money laundering and conspiracy charges. These include allegations related to violating the International Emergency Economic Powers Act.
Storm is currently raising funds for his defense. According to a post on X, he is seeking $2 million for legal expenses. The Ethereum Foundation donated $500,000 last week to support his case.
Statements from Storm and Industry Reactions
Roman Storm wrote on social media that he built Tornado Cash as a tool to support privacy in decentralized finance. “I poured my soul into Tornado Cash — software that’s non-custodial, trustless, permissionless, immutable, unstoppable,” he said on Friday.
He warned that the case could affect the broader DeFi space. “If I lose, DeFi dies with me,” Storm said. “The dream of financial freedom, the code I believed in — it all fades into darkness.”
The trial is expected to draw wide attention from legal experts, technology developers, and the crypto community. Many are watching how the court will define liability in open-source and decentralized software projects.
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