Samourai Wallet Co-Founder Gets 5 Years in Prison for Laundering $237M in Crypto—Privacy or Crime?
Another privacy tool founder falls to regulators—this time, it's Samourai Wallet's architect taking the hit.
Privacy vs. crime: The $237M question
The DOJ didn't blink when slamming a 5-year sentence on the crypto mixer's creator. Another 'financial freedom' project just became a case study in laundering infrastructure.
Active verbs, passive compliance
Judges keep carving up privacy tech like a holiday turkey—while TradFi banks move 100x these amounts with a fine and a shrug. The hypocrisy stings worse than the sentence.
TLDR
- Samourai Wallet co-founder Keonne Rodriguez was sentenced to five years in prison for operating an unlicensed money transmitting business
- Rodriguez and co-founder William Lonergan Hill created a crypto mixing service called “Whirlpool” that prosecutors say laundered $237 million in criminal proceeds
- Both founders pleaded guilty in July 2025 after initially contesting the charges filed in April 2024
- Rodriguez was ordered to pay a $250,000 fine and already paid $6.3 million in forfeiture before sentencing
- Co-founder William Lonergan Hill is scheduled to be sentenced on November 19, 2025
Samourai Wallet co-founder Keonne Rodriguez received a five-year prison sentence on Thursday in U.S. District Court for the Southern District of New York. District Judge Denise Cote handed down the maximum sentence for conspiracy to operate an unlicensed money transmitting business.
JUST IN: Samourai Wallet developer Keonne Rodriguez has been sentenced to 5 years in federal prison, the maximum allowed for conspiring to operate an unlicensed money transmitting business.
Prosecutors say Samourai’s Bitcoin mixing service laundered $237 million tied to drug… pic.twitter.com/adBS8jev1Y
— bitcoin News (@BitcoinNewsCom) November 6, 2025
Rodriguez served as chief executive officer of Samourai Wallet. He created the service with co-founder William Lonergan Hill, who served as chief technology officer. The pair designed Samourai to include a crypto mixing service called “Whirlpool.”
Prosecutors said the service was used to launder $237 million in criminal proceeds. They alleged that Rodriguez and Hill encouraged users to launder criminal money through the mixer on social media platform X. The mixing service reportedly processed proceeds from drug trafficking, darknet marketplaces, cyber intrusions, frauds, murder-for-hire schemes, and a child pornography website.
Rodriguez and Hill were arrested in April 2024. They initially fought the charges but changed their pleas to guilty in July 2025. They pleaded guilty to the unlicensed money transmitting conspiracy charge in exchange for prosecutors dropping a money laundering conspiracy charge that carried a maximum 20-year sentence.
Sentencing Details and Financial Penalties
Judge Cote expressed concerns about Rodriguez’s letter to the court submitted before sentencing. She said she had a “troubling reaction” to the letter and felt Rodriguez had not fully accepted responsibility for his actions. The judge stated that imposing the maximum sentence was necessary for both individual and general deterrence.
Rodriguez addressed the court during the hearing. He apologized and told the judge he WOULD not break the law again. His lead attorney, Arnold and Porter partner Michael Kim Krouse, had requested a sentence of one year and a day in prison.
Rodriguez’s lawyer attempted to distinguish him from former FTX CEO Sam Bankman-Fried. He described Rodriguez as a “warm family man” who lives in a $250,000 home in Pennsylvania. Bankman-Fried was sentenced to 25 years in prison in 2024 after being found guilty on seven criminal counts.
Prosecutors presented evidence that Rodriguez knew he was breaking the law. They said law enforcement found a six-page escape plan in his home. The plan detailed how Rodriguez would use burner phones, cash motels, and country roads to evade authorities.
Rodriguez already paid $6.3 million in forfeiture before his sentencing. His lawyer said this was unusual and showed Rodriguez was taking responsibility. Judge Cote ordered Rodriguez to pay an additional $250,000 fine despite his lawyer’s claims that Rodriguez and his wife had “no money left” after the forfeiture payment.
Connection to Broader Crypto Privacy Cases
The sentencing comes as crypto mixing services face increased legal scrutiny. Tornado Cash developer Roman Storm was found guilty on a money transmitting charge in August 2025. The jury could not reach a verdict on money laundering and sanctions charges in that case.
Crypto advocacy groups have raised money for legal funds supporting Storm and Tornado Cash co-founder Alexey Pertsev. Two prosecutors from Storm’s trial attended Rodriguez’s sentencing hearing. One of them was Assistant U.S. Attorney Nathan Rehn, who was a lead prosecutor in the case against Bankman-Fried.
Judge Cote imposed a three-year probation period following Rodriguez’s prison term. She ordered that if Rodriguez works during his sentence through the UNICOR program, 50 percent of his monthly earnings will go toward paying his fine. After his release, 25 percent of his gross monthly earnings will be garnished until the fine is fully paid.
William Lonergan Hill is scheduled to be sentenced by Judge Cote on November 19, 2025. The hearing was originally scheduled for Friday but was postponed.
