Paradigm Backs Roman Storm in Tornado Cash Case With Amicus Brief Filing

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Why Paradigm is Throwing Legal Wrenches in the Tornado Cash Case! 🚀

In a twist that could only be described as a cosmic joke, Paradigm has decided to file an amicus brief in the rather riveting saga of United States v. Roman Storm. They’re waving their legal flags, warning that prosecuting software developers as money transmitters—without them even having custody of funds—is like trying to catch a greased pig at a county fair. It threatens legal norms, software innovation, and the very fabric of open-source development in the U.S. Who knew coding could be so perilous? 🐖💨

High-Profile Amicus Brief Challenges Prosecutorial Overreach

Our friends at Paradigm, the crypto investment firm with a penchant for legal theatrics, have formally entered the fray. They’re expressing their deep concern that the prosecution’s stance could lead to consequences so severe that even the most hardened software developers might consider a career in interpretive dance instead. 💃

Now, what’s an amicus brief, you ask? It’s a fancy legal document submitted by an outside party—think of it as a concerned neighbor peeking over the fence to offer unsolicited advice on how to raise your pet iguana. It provides the court with additional information, expertise, or perspective, which is just a posh way of saying, “Hey, you might want to rethink that.”

The case, brought by the U.S. Attorney’s Office in the Southern District of New York (SDNY), is targeting Roman Storm, co-founder of Tornado Cash. They’re alleging that developing software for peer-to-peer crypto transactions is akin to “money transmitting” under 18 U.S.C. §1960. Paradigm and other legal commentators are scratching their heads, arguing that this claim contradicts long-standing regulatory guidance and case law. It’s like trying to fit a square peg in a round hole—while blindfolded. 🔍

Paradigm’s Call for Jury Clarity

In its amicus brief filed in a New York District court on June 13, Paradigm contends that if the charges aren’t dismissed, the court must carefully instruct the jury on what it means to be a money transmitter. Specifically, jurors should be required to find beyond a reasonable doubt that Storm knowingly operated a business transmitting funds for the public, collected recurring fees, and exercised control over the transmitted funds. Because, you know, clarity is key when you’re dealing with legal jargon that sounds like it was written by a caffeinated octopus. 🐙

Paradigm maintains that without custody or control, the act of transmitting funds is as legally and practically impossible as finding a unicorn in a haystack. They concluded with a warning that allowing the SDNY’s interpretation to stand could set a precedent that threatens not just crypto innovation but open-source development in sectors like AI and broader fintech. Because who doesn’t want to live in a world where innovation is stifled by legalese? 🤖

A Case With Far-Reaching Implications

At the heart of this legal kerfuffle is whether merely creating and publishing open-source code for decentralized applications can be treated as a criminal act if that code is later misused. Paradigm highlighted in its brief that for years, the U.S. Treasury Department has explicitly clarified that “the production and distribution of software, in and of itself, does not constitute acceptance and transmission of value.” It’s almost as if they were trying to say, “Hey, just because you built a car doesn’t mean you’re responsible for every joyride.” 🚗💨

Furthermore, in 2019, the Treasury emphasized that whether an intermediary exerts “total independent control” over users’ cryptocurrency is a critical factor in determining money transmitter status under the Bank Secrecy Act. Paradigm argues that Storm, as a developer of non-custodial, neutral Tornado Cash software, should have been able to rely on this guidance without facing criminal prosecution. Because, let’s face it, no one wants to be the unwitting star of a legal drama. 🎭

DOJ’s Own Policy Shift at Odds With Prosecution

In a noteworthy development that could only be described as a plot twist worthy of a soap opera, the Department of Justice (DOJ) issued a policy memo in April explicitly discouraging the type of prosecutorial action now being taken against Storm. It’s like the DOJ is saying, “We didn’t mean it! We were just kidding!”

While SDNY dropped charges under those specific registration provisions, it continues to pursue Storm using a different prong of Section 1960, leveraging what critics see as a loophole to argue that a developer can be criminally liable without custody or control of funds. Paradigm calls this position inconsistent with both the law and operational realities. It’s a bit like trying to argue that a chef is responsible for the health of diners who ordered takeout. 🍔

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2025-06-17 18:15