According to CoinDesk, the trial of Tornado Cash developer Roman Storm, originally scheduled for September, has been postponed to December 2nd by a US judge at Friday's hearing. Prosecutor Thane Rehn said the trial is expected to last two weeks.The core issue of the US Department of Justice's case against Roman Storm is whether he created the software or controlled the service. At Friday's hearing, Brian Klein, a defense lawyer for Waymaker LLP, argued that Storm no longer controlled Tornado Cash after May 2020 - during this time, Storm was accused by the Department of Justice of violating the law by running Tornado Cash.Waymaker's Keri Axel added that the Tornado Cash user interface itself does not control the transactions sent by users. The defense repeatedly emphasized that Storm did not control the pools of Tornado Cash, which are immutable, and therefore cannot be held criminally responsible for how people use the mixer.The judge did not make any decisions on Friday, saying that he will "quickly" rule on all motions.

On Tuesday, a Dutch judge ruled that Tornado Cash developer Alexey Pertsev was guilty of money laundering. The court sentenced Pertsev to 64 months in prison. In August 2022, Tornado Cash was blacklisted by the US government, and this is the first time the developer has been sentenced to prison in the Netherlands. At the time, the US Treasury Department claimed that Tornado Cash was a key tool for the North Korean hacker group Lazarus. The Lazarus group is linked to the $625 million hack of Axie Infinity's Ronin Network and other major cryptocurrency thefts.

A Dutch court composed of three judges has ruled that Tornado Cash developer Alexey Pertsev committed the crime of laundering $1.2 billion in illegal assets on a cryptocurrency mixing platform. It is expected that the panel will also sentence 31-year-old Russian resident Alexey Pertsev on Tuesday, and Pertsev's lawyer will have 14 days to appeal the judge's ruling. Experts say that this ruling will reshape the privacy protection process in the decentralized finance field and have a "chilling effect" on the development of open-source software that provides financial privacy protection tools for users.

The US Department of Justice (DOJ) opposes the motion to dismiss the charges of conspiracy and money laundering against Tornado Cash co-founder Roman Semenov. They believe that the defense has raised disputed facts that should be considered by a jury and not dealt with at an early stage. The DOJ accuses Semenov and others of conspiring to launder money, operating an unlicensed money transmitting business, and violating sanctions, alleging that entities such as North Korea's Lazarus Group used Tornado Cash for money laundering.

The U.S. Department of Justice has rejected Tornado Cash developer Roman Storm's motion to dismiss criminal charges, stating that the defense filing presented disputed facts that should be weighed by a jury. Storm and fellow developer Roman Semenov were charged with conspiring to commit money laundering, operating an unlicensed money transmitter, and violating sanctions law by creating and operating Tornado Cash, a crypto mixing service. The DOJ disputed Storm's arguments that Tornado Cash is not a custodial mixing service and that he was not able to control the service or block criminal entities from using it, providing evidence that Storm and his co-founders maintained control over the mixer. Storm is set to go on trial in September, while Semenov remains at large.

Coinbase's legal chief, Paul Grewal, published a series of articles on the X platform. Grewal admitted that the plaintiff in the "Tornado Cash" case had made a strong response to the argument made by the US Treasury Department in the Fifth Circuit Court of Appeals. According to the submitted documents, the Treasury Department needs to "prove that it has approved an association composed of people with a common purpose".Regarding the sanction proposal put forward by the Treasury Department, Grewal expressed concern about the interpretation of existing regulations, especially when it comes to open source software code. He emphasized that such code is not property, which poses a challenge to the Treasury Department's regulatory power limited to "property" involving foreign interests.Grewal believes that any attempt by the Treasury Department to regulate the use of open source software such as Tornado Cash by US citizens must be authorized by Congress. He mentioned the Treasury Department's recent call to Congress to address what it sees as regulatory loopholes related to such software.

The future of financial privacy is on trial

Roman Storm’s lawyers argued that the charges are “fatally flawed” and must be dismissed, given “there was nothing” Storm could have done to prevent sanctioned entities from using the crypto mixer.

According to Snapshot governance page on March 8th, the Arbitrum community initiated a proposal to support the legal defense of Tornado Cash co-founder Roman Storm and Tornado Cash developer Alexey Pertsev. The proposal states that Tornado Cash is a beacon of privacy and security in the cryptocurrency industry, providing users with a reliable way to conduct private transactions on the Ethereum blockchain. The goal of this proposal is twofold: to provide strong legal defense for both individuals and to uphold the right of developers to contribute to the deployment of permissionless open-source software. By rallying support for their legal fund, the aim is to protect the future of privacy-preserving technology, as well as broader principles such as innovation, decentralization, and individual sovereignty within the cryptocurrency industry.

Tornado Cash has suffered a backend attack with a vulnerability that can steal deposit data and funds, putting user deposits at risk, as reported by CoinDesk. As per a Medium post by community member Gas404, malicious javascript code was hidden in a governance proposal submitted by a so-called Tornado Cash developer two months prior to January 1st. The code redirected deposit data to a public server hosted by the same developer, resulting in one deposit being stolen.