DOJ Declares Open Source Smart Contract Developers Not Criminally Liable Without Intent
Justice Department draws line in digital sand—code isn't crime without criminal purpose.
Legal Clarity for Builders
The DOJ's Criminal Division chief just handed open-source developers a massive win. No more looking over shoulders when publishing smart contract code—unless there's provable intent to facilitate crimes. This isn't just legal nuance; it's a green light for innovation without the fear of unintended consequences.
Shield Up for Coders
This stance effectively creates a safe harbor for developers contributing to public blockchain projects. It distinguishes between creating neutral technology and actively participating in illegal activities—finally acknowledging that code itself is amoral until wielded with malicious purpose.
Finance's Ironic Twist
Meanwhile, traditional bankers still charge 2% fees for international transfers that take three days—but sure, worry about the open-source devs building free, instant alternatives. The future's being coded while legacy finance counts its coins.
Developer liability limits
The Criminal Division addressed industry concerns about holding smart contract developers criminally liable for operating unlicensed money transmitting businesses.
Galeotti stressed that developers contributing code to open source projects without specific criminal intent face no liability for aiding and abetting violations.
He explained:
Both aiding and abetting charges and conspiracy prosecutions require prosecutors to prove specific intent, establishing a higher evidentiary standard for developer cases.
The guidance directly responds to defense counsel presentations raising concerns about criminal liability for smart contract developers and code publishers not otherwise involved in peer-to-peer transactions.
The Criminal Division acknowledged these as “complex questions of law and fact” requiring rigorous case-by-case evaluation.
Unlicensed money transmission protections
For unlicensed money transmission charges under 18 USC 1960, the department will not prosecute regulatory violations absent evidence that defendants knew specific legal requirements and willfully violated them.
Galeotti provided specific protections for truly decentralized software that automates peer-to-peer transactions without third-party custody or control over user assets, stating:
The guidance considers regulatory guidance suggesting that non-custodial crypto software does not constitute unlicensed money transmission.
Further, Galeotti established clear principles distinguishing between legitimate development and criminal conduct.
Developers of neutral tools with no criminal intent should not be held responsible for third-party misuse of their creations. When third parties violate criminal law using developer tools, prosecutors should target the misusing party rather than well-intentioned creators.
The DOJ official described the department’s technology-neutral approach, which treats digital asset crimes identically to traditional financial violations while protecting lawful innovation from regulatory overreach.
