Samourai Wallet Co-Founder Gets 5 Years Behind Bars – Privacy Tech Under Fire

Privacy-focused crypto tool faces legal reckoning as feds crack down on financial anonymity.

The Hammer Drops on Crypto Privacy

Federal judges just made an example of Samourai Wallet’s architect—five years in prison sends a clear message to the encryption crowd. The DOJ’s war on ‘financial obscurity’ claims another scalp.

Code ≠ Law (Until It Is)

Developers keep insisting privacy tools are neutral, but prosecutors see bulletproof transaction layers as criminal enablers. This verdict blurs the line between writing code and running a shadow-banking operation.

Regulators Play Whack-a-Mole

While Treasury officials chase crypto mixers, traditional banks launder billions unnoticed—but hey, at least those fines come with shareholder dividends.

The case against Samourai Wallet

Keonne Rodriguez and his co-founder William Lonergan Hill launched Samourai Wallet in 2015 as a privacy-focused Bitcoin wallet.

The wallet was advertised on its website and via social media as a “premium privacy service” and it made use of marketing language such as “No email address, no ID check, and no hassle”, and clearly targeted “Dark/Grey Market participants” who were repeatedly reminded that their bitcoin transfers would be hard to trace on the platform.

In April 2024, Keonne Rodriguez and William Lonergan Hill were arrested and later indicted by the U.S. government.

Samourai never registered as a money transmitting business with the Financial Crimes Enforcement Network (FinCEN) and did not implement effective anti-money-laundering (AML) or “know your customer” (KYC) protocols.

Prosecutors claim that Samourai processed about $237 million in illicit funds between 2015 and April 2024.  Rodriguez and Hill pleaded guilty on July 30, 2025, to a charge of conspiracy to operate an unlicensed money-transmitting business.

Rogriguez’s verdict is bad news for privacy advocates

On November 6, 2025, Keonne Rodriguez was sentenced to 60 months (5 years) in federal prison. That sentence is the statutory maximum for the charge requested by the prosecution, as Cryptopolitan reported earlier during the week. Rodriguez is also required to pay a fine and will be supervised after his release.

Judge Denise L. Cote was not swayed by Rogriguez’s defense of privacy tools, citing its failure to address the real-world consequences of facilitating criminal transactions. The presiding judge also found his letters of remorse failing to show sufficient acknowledgement for the human suffering his actions caused.

The verdict is bad news for the other party in this case as well as Tornado Cash developers facing similar charges for running a privacy tool for transmitting funds. Meanwhile, it appears the U.S. government’s promise to allow digital asset innovation while cracking down on illegality does not extend to crypto-mixers and privacy-enhancing tools when it’s used to aid criminal proceeds. This has caused some tension as open-source privacy tools have been praised by advocates as protections for financial freedom and human rights.

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