Paradigm, a leading crypto venture capital firm, has filed a powerful amicus brief urging a federal court to dismiss key charges against Roman Storm, co-founder of Tornado Cash, arguing that prosecuting him without proof of knowing misconduct poses a direct threat to open-source software development in the United States.
Storm, who faces up to 45 years in prison, is accused of conspiracy to facilitate money laundering, operate an unlicensed money-transmitting business, and violate U.S. sanctions. His trial is scheduled for July 14 in the Southern District of New York.
“Prosecuting Code Writers is Absurd,” Paradigm Warns
Filed on June 13 and made public on Monday, Paradigm’s brief asserts that for Storm to be convicted under federal money transmission laws, clear evidence must show he knowingly operated a business that controlled user funds, charged transaction fees, and was aware of criminal fund flows.
“Subjecting a software developer to criminal liability…when their only ‘operation’ was creating immutable open-source code, would be as absurd as prosecuting a television manufacturer for state secrets being divulged on-air,” Paradigm wrote in its filing.
The firm emphasized that Storm’s involvement was limited to publishing self-custodial, open-source software, not managing transactions or customer assets a key distinction supported by FinCEN guidance from 2019 under the U.S. Treasury Department.
Paradigm Legal Team Warns of Dangerous Precedent
In a blog post accompanying the brief, Katie Biber (Chief Legal Officer) and Gina Moon (General Counsel) warned that allowing the prosecution’s theory to stand could open the door to criminalizing developers for how others use their code.
“This case lets unelected prosecutors change the plain meaning of criminal statutes and threaten developers with prison even when they’re following existing, widely-accepted regulatory guidance,” Biber and Moon wrote.
Industry and Legislative Backlash Builds
Paradigm’s stance echoes growing industry frustration over the case. In recent months:
- Over 250 technologists and executives, including Ethereum developer Tim Beiko and Bankless co-founder Ryan Sean Adams, signed a public letter urging the Trump administration to intervene.
- The DeFi Education Fund argued the DOJ’s approach risks criminalizing “code-writing itself.”
- Lawmakers have raised similar concerns during Congressional hearings on the Digital Asset Market Clarity Act, signaling broader unease with the current prosecutorial direction.
A Landmark Case for Open-Source and Crypto Development
Storm was arrested in August 2023, sparking international concern about U.S. enforcement overreach. With implications for all open-source developers, the outcome of the case could shape how blockchain protocols, DeFi platforms, and self-custody technologies are treated under U.S. law.
As the July 14 trial date approaches, the court’s handling of Paradigm’s arguments may determine whether publishing non-custodial crypto code is treated as a protected innovation or as a criminal offense.
