The Ethereum Foundation has announced a $1.25 million donation to aid the legal defense of Alexey Pertsev, the developer of Tornado Cash, who is currently facing legal challenges related to his work on privacy-focused blockchain technology.
Pertsev’s Legal Battle and House Arrest
Pertsev had been in pretrial detention since August 2022 before being released on February 7, 2025, under house arrest as he prepares for an appeal. His detention was suspended by a Dutch court on February 6, following an earlier decision in November 2024 to extend his incarceration.
The Ethereum Foundation’s official statement emphasized its stance on privacy and software development:
“Privacy is normal, and writing code is not a crime.”
The foundation also encouraged community members to contribute to Pertsev’s defense.
Background: Tornado Cash and U.S. Sanctions
In May 2024, Pertsev was found guilty of money laundering by the ’s-Hertogenbosch Court of Appeal and sentenced to 64 months in prison. The court’s decision came despite arguments that Pertsev and his team did not control the funds passing through Tornado Cash, a decentralized privacy tool.
The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned Tornado Cash in 2022, citing that over $7 billion in illicit funds had been laundered through the platform since its launch in 2019. OFAC also claimed that $455 million in stolen funds were funneled through the service by the North Korean Lazarus Group. However, a U.S. court later ruled that the Treasury overstepped its authority in sanctioning Tornado Cash’s immutable smart contracts.
Community and Industry Response
Pertsev’s prosecution has been met with strong criticism from Ethereum co-founder Vitalik Buterin and other industry figures. At a Berlin conference in 2024, Buterin voiced concerns over the case, stating:
“The Alexey thing is definitely really unfortunate. Many people have assumed that just building software is legal and a legitimate way to advocate for privacy.”
Meanwhile, Tornado Cash co-founder Roman Storm is also facing legal action in Manhattan over allegations of facilitating money laundering. A New York court recently denied his motion to dismiss the charges, prompting further support from industry leaders.
Wider Implications for Crypto Development
The Ethereum Foundation’s donation aligns with growing concerns that the prosecution of developers could set a precedent that holds software creators criminally liable for the actions of third-party users.
Venture capital firm Paradigm has also donated $1.25 million to support Roman Storm’s legal defense, with co-founder Matt Huang stating:
“The prosecution’s case threatens to hold software developers criminally liable for the bad acts of third parties, which would have a chilling effect in crypto and beyond.”
What is Tornado Cash?
Tornado Cash is a crypto mixing service built on the Ethereum blockchain, designed to obfuscate transaction origins and destinations. By allowing users to deposit ETH or ERC-20 tokens into a smart contract and later withdraw them to another address, the service effectively breaks the traceability link between sender and receiver.
Tornado Cash has recently been linked to high-profile incidents, including the Infini hack and Phemex exchange exploit, where stolen funds were reportedly laundered using the platform.
The Ethereum Foundation’s donation underscores the broader debate surrounding privacy, regulation, and software development in the crypto space. As legal proceedings continue, the case of Alexey Pertsev could have lasting implications for developer liability and blockchain privacy solutions worldwide.
