Judge to Tornado Cash Prosecutor: 'Doing Better Before You Started Talking'

What Happened

On April 9, Judge Katherine Polk Failla held oral arguments on Roman Storm's Rule 29 motion for a judgment of acquittal. Storm co-founded Tornado Cash, a non-custodial Ethereum mixer. He was convicted in August 2025 on one count of conspiracy to operate an unlicensed money-transmitting business.

A jury deadlocked on two more serious charges — conspiracy to commit money laundering and conspiracy to violate IEEPA sanctions. Storm's motion argues the prosecution's evidence was legally insufficient across all counts. Failla heard both sides and issued no ruling. She is taking weeks.

The government's theory of liability, taken to its limit, criminalizes maintaining any privacy protocol with legitimate users.

The Exchange That Landed Badly for the Government

Failla asked AUSA Ban Arad whether merely creating Tornado Cash was a crime. It was not, Arad said. Failla then asked whether merely maintaining it was a crime. Arad's position: yes — because mixers work better with clean funds mixed in, so serving law-abiding users contributes to the protocol's effectiveness for money laundering.

Failla dismissed the argument directly: 'You were doing better before you started talking.'

The exchange exposes the prosecution's theory in its most extended form. The government's position, pushed to its logical conclusion, is that a developer who maintains a privacy tool with both criminal and legitimate users is criminally liable because the legitimate users make the tool more useful for the criminals.

Storm's defense has argued throughout that this theory would criminalize the publication of any decentralized software with privacy features.

The Supreme Court Argument

On April 2, Storm's defense filed a supplemental argument citing the 2026 Supreme Court ruling in Cox Communications v. Sony Music Entertainment. The Court held Cox was not contributorily liable for copyright infringement by its subscribers. Storm's defense drew the parallel: a non-custodial protocol developer providing infrastructure is not materially contributing to specific criminal acts.

On April 7, the DOJ responded: Cox was civil copyright liability, Storm faces criminal money laundering and sanctions charges, the comparison fails. Failla has both arguments.

What This Means for You

The Storm case is the most consequential open legal question for Bitcoin privacy tooling in the United States. The Samourai founders are in federal prison. Roman Storm is the next test of whether maintaining non-custodial privacy software constitutes a criminal act when some users are criminals.

If Failla grants the acquittal, the government faces a hard choice: appeal a ruling that throws out a conviction, or accept the precedent. If denied, October retrial expands the record further. Either outcome sets a marker for every privacy tool developer in the US. The legal environment is contested, not resolved.

What to Watch

Watch for Failla's ruling on the Rule 29 motion. Watch the DOJ's response if she grants it. And watch the October retrial if denied — the two hung counts carry the more serious charges, and a second jury verdict on money laundering and sanctions violations would be the more consequential legal precedent for the industry.

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