Samourai Wallet Founders Flip Script—Guilty Plea Deal Rocks Crypto Privacy World

Privacy pioneers face the music as DOJ cracks down.

Once hailed as champions of financial anonymity, the founders of Samourai Wallet just folded their hand in a high-stakes legal showdown. The surprise reversal signals regulators aren't bluffing about tracking crypto's shadow economy.

Why it matters: This isn't your grandma's money-laundering case. The plea deal torpedoes a flagship privacy tool used by Bitcoin maximalists—and sets a precedent that'll have other crypto developers sweating through their hoodies.

The kicker? Somewhere in Manhattan, a Goldman Sachs VP is sipping a $28 oat milk latte while reading this news and feeling smug about traditional finance's KYC paperwork.

Indictment Links Wallet’s Mixing Tools to Silk Road and Other Crimes

Prosecutors alleged Samourai processed more than $2b in unlawful transactions, including payments tied to the defunct Silk Road marketplace.

The Department of Justice claimed the wallet’s popular mixing services, Whirlpool and Ricochet, were actively marketed to criminals. According to the indictment, private messages revealed Hill describing a focus on the “black/grey circular economy.”

Bitcoin and other coin mixers blend transactions from multiple users, making them harder to trace on public blockchains. Privacy advocates see them as vital tools for financial anonymity, but US authorities view them as magnets for illicit activity.

In 2022, the Treasury Department barred Americans from using the Ethereum-based mixer Tornado Cash, citing links to criminal groups.

Privacy Advocates Fear Precedent From High-Profile Mixer Prosecutions

The Samourai case mirrors actions against other privacy tools such as Tornado Cash and bitcoin Fog. Tornado Cash co-founder Roman Storm is awaiting a verdict this week, while Bitcoin Fog’s founder was convicted last year.

Critics argue these prosecutions threaten the open-source developers behind non-custodial software, even when there is no direct evidence of criminal intent.

This sets a terrible terrible precedent for the future safety of open source developers.

Samourai Wallet built our XMR BTC swap protocol into their wallet. This is not what their trial was about but still… The Monero community should care about this.

It's even more… https://t.co/qIAsFHP94W

Rodriguez and Hill were arrested in 2024, shortly before federal agents shut down Samourai Wallet. Prosecutors claimed the founders earned $4.5m in fees from the mixing services while enabling money laundering from phishing schemes and other crimes. The charges carry a maximum combined prison sentence of 25 years.

Defense Tried to Dismiss Case Citing DOJ Memo on Crypto Mixers

In April 2025, both sides asked for a delay in proceedings. This was because Deputy Attorney General Todd Blanche had issued a memo, which suggested prosecutors should avoid charging crypto mixer operators for “unwitting violations.”

The defense also argued Samourai’s non-custodial design aligned with 2019 guidance from the Financial Crimes Enforcement Network, which exempts anonymizing software providers from money transmitter rules.

The court scheduled arguments on the dismissal motion for July 22. However, that effort did not succeed. Additionally, claims that prosecutors had suppressed exculpatory advice also failed. As a result, a trial date had been set for Nov. 3.

Judge Cote has not yet detailed how the plea change could affect sentencing. Conspiracy to commit money laundering carries a maximum penalty of 20 years in prison, while operating an unlicensed money-transmitting business can add five more.