The ongoing legal action against Tornado Cash founder, Roman Storm, by US federal prosecutors is set to continue unabated, albeit with a slight modification to their initial indictment. This comes after the Department of Justice (DOJ) made adjustments to its crypto enforcement in the preceding month.
Jay Clayton, the acting US Attorney for Manhattan, informed federal court judge Katherine Polk Failla in a letter dated May 15 that while the charges against Storm remain, one element of the conspiracy to operate an unlicensed money transmitting business charge will be dropped.
“Upon reassessing the circumstances of this case, both this Office and the Office of the Deputy Attorney General have arrived at the conclusion that the prosecution aligns with the letter and spirit of the April 7, 2025 Memorandum from the Deputy Attorney General,” Clayton stated.
In an April memorandum, Deputy Attorney General Todd Blanche declared the DOJ’s decision to cease the implementation of “regulation by prosecution” for crypto. He also stated that the department would not prosecute crypto mixers such as Tornado Cash “for the acts of their end users or unwitting violations of regulations.”
As per Clayton’s announcement, the indictment against Storm will no longer include the allegation of failing to meet money transmitting business registration requirements. This charge had initially been pursued in connection with claims that Storm had illicitly operated Tornado Cash as an unlicensed money transmitter.
However, the government will proceed with the charge under the assertion that Storm transferred funds while being aware they were either proceeds from a criminal act or intended to aid illegal activities. The Justice Department has accused Tornado Cash of facilitating the laundering of over $1 billion in crypto, including for the state-backed North Korean hacking group, the Lazarus Group.
Clayton made it clear that the Justice Department still intends to bring forward the other two charges in its indictment: one count of money laundering conspiracy and one count of conspiracy to violate US sanctions. Each of these charges carries a maximum sentence of 20 years in prison. Meanwhile, the unlicensed money transmitter conspiracy charge could result in a maximum sentence of five years.
Storm, who has pleaded not guilty, is set to face trial on July 14. He was charged alongside co-founder Roman Semenov, who remains at large and is believed to be residing in his home country of Russia.
Other crypto executives facing similar charges have referred to Blanche’s memo in their attempts to have their cases dismissed. They include the co-founders of crypto mixer Samourai Wallet, Keonne Rodriguez and William Hill, and Braden John Karony, CEO of crypto firm SafeMoon.
