The Ethereum Foundation funded the founder of Tornado Cash with US$1.25 million to help defend the "code innocence" in the lawsuit

👤 45ux@Riley 📅 2026-02-03 20:56:46

The Ethereum Foundation pledged up to $1.25 million to fund Tornado Cash founder Roman Storm’s lawsuit, with developer responsibility and privacy attacks and defenses becoming the focus.
(Preliminary summary: The currency mixer Tornado Cash won the case perfectly! Texas court: The U.S. Treasury Department cannot impose any further sanctions)
(Background supplement: The controversy of the currency mixer Tornado Cash is not over yet? Coinbase is furious: The U.S. Treasury Department obscured the handling and evaded the final ruling)

Contents of this article

The Ethereum Foundation pledges up to $1.25 million to fund Tornado Cash co-founder Roman Storm With a legal team, the outcome of the case is expected to influence the boundaries of encryption privacy tools, open source development and regulation.

The Foundation invests US$1.25 million in aid

The Ethereum Foundation announced on its official The announcement reiterated the foundation's position:

"Privacy is normal, and writing code is not a crime."

In 2023, the foundation also provided the same amount of support to Tornado Cash developer Alexey Pertsev.

Trial focus: Whether open source code constitutes a "remittance business"

Storm was charged with unlicensed remittance business, money laundering and sanctions violations in the U.S. Department of Justice's "Operation Chop Chop" operation.

The U.S. Treasury Department’s Office of Foreign Assets Control (OFAC) placed Tornado Cash on the sanctions list as early as 2022. Defense attorneys argued in Manhattan federal court that prosecutors failed to disclose favorable evidence of communications with FinCEN and argued that the Tornado Cash smart contract did not meet the definition of a remittance business.

The Court of Appeals has previously ruled that OFAC exceeded its authority because the sanctions targeted immutable contracts and not individuals. The trial is scheduled to begin on July 14, 2025.

Crypto community and regulators expressed their stance

Vitalik Buterin has personally donated approximately US$170,000, and Coin Center, DeFi Education Fund and Blockchain Association also submitted friend of the court submissions. Former SEC Chairman Paul Atkins said at public events that people should not fall under U.S. securities laws just because they write code.

Amicus curiae: A friend of the court who is not a party to the litigation, voluntarily or in response to the requests of both parties to the litigation, provides legal documents with relevant information and legal explanations to the court to assist the proceedings or allow the judge to better understand the case.

Potential Impact: Chilling Effect or Legal Guardrails

The legal community generally believes that if Storm is found guilty,open source developers may bear criminal liability for code misuse by third parties in the future, and privacy agreements and decentralized applications may slow down.

On the contrary, if prosecutors lose the case, it will strengthen the legitimacy of encryption privacy tools and also draw the line for OFAC's sanction authority. The direction of the case will profoundly affect the innovation speed and compliance costs of decentralized finance.

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45ux@Riley

45ux@Riley

Blockchain and cryptoassets editor, focusing onpolicyDomain content analysis and insights

Comment (10)

Paxton 29days ago
The article's attitude towards supervision is somewhat naive.
Soren 29days ago
In the future, blockchain will be more popular but more invisible.
Tessa 29days ago
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Quinn 29days ago
This article has clear logic and is of great benefit.
Jacob 32days ago
The article's outlook on scalability is overly optimistic.
Gale 33days ago
User experience is the key to mass adoption.
Gail 42days ago
Agreed, the future is the era of trusted networks.
Joanne 44days ago
There is still a large talent gap in the industry.
Brooklyn 53days ago
Sybil attack costs may be lower in PoS.
Talia 54days ago
Looking forward to more high-quality insight content.

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