DOJ Pivots on Crypto Developers as Roman Storm Faces Retrial - What’s Changing?

Federal prosecutors shift stance amid high-profile Tornado Cash case—signaling potential recalibration of developer liability standards.

Legal Earthquake

The Department of Justice just softened its position against crypto developers—right as Roman Storm prepares for his second courtroom battle. This isn’t just legal maneuvering—it’s a potential watershed moment for decentralized finance.

Prosecutors now acknowledge developers might not control how users deploy their code—a stark contrast to earlier arguments that treated code authorship as tacit endorsement of all downstream use.

Storm’s retrial—set against this revised backdrop—could redefine where developer responsibility ends and user agency begins. Legal experts call it a ‘strategic retreat’ from the DOJ’s previously hardline stance.

Market observers note the timing—right as another bull run sends crypto valuations soaring and regulators scramble to keep pace. Because nothing says ‘regulatory clarity’ like changing your argument mid-retrial—classic finance theater.

This pivot might offer developers breathing room—but Storm’s case remains a high-stakes test of how far ‘ignorance isn’t bliss’ extends in decentralized systems.

TLDR

• DOJ official says writing code without ill intent is not a crime in crypto cases.

• DOJ shifts stance on crypto cases, suggesting a more balanced approach to developers.

• Roman Storm’s retrial may be affected by DOJ’s change in enforcement policies.

• DOJ vows not to use federal criminal statutes as a tool for new crypto regulations.

A recent speech by Matthew Galeotti, the acting assistant attorney general for the U.S. Department of Justice (DOJ), signals a potential shift in the department’s approach to prosecuting crypto developers. Though not directly referencing Roman Storm, the co-founder of Tornado Cash, Galeotti’s remarks could have significant implications for his case. In a summit held by the American Innovation Project, Galeotti discussed how the DOJ is recalibrating its stance on prosecuting digital asset developers who are not involved in criminal activities.

The remarks come as the DOJ is reconsidering how it handles cases involving crypto developers, particularly those like Storm, whose case is currently under scrutiny. The shift, as indicated by Galeotti, is part of a broader change within the DOJ that emphasizes “even-handed enforcement of the law,” focusing on criminal activity rather than penalizing developers for code contributions made in good faith.

DOJ’s New Approach to Crypto Enforcement

Galeotti explained that the DOJ will no longer prosecute developers simply for writing code if their actions are not intended to aid or abet illegal activities. He stressed that “merely writing code without ill intent is not a crime,” addressing concerns that software creators could be unfairly targeted in the rapidly evolving digital asset space.

He further clarified that the department’s focus will remain on those who knowingly engage in illegal activities such as fraud, money laundering, or sanctions evasion.

Galeotti also assured the audience that the DOJ would not use federal criminal statutes to create new regulations for the cryptocurrency industry, ensuring developers would not face criminal prosecution for unintentional regulatory violations.

Tornado Cash Case and Its Broader Impact

Roman Storm’s ongoing legal battle has brought attention to the potential legal risks faced by developers in the blockchain space. In August 2023, Storm was indicted on charges of conspiracy to commit money laundering, operate an unlicensed money transmission business, and violate U.S. sanctions.

After a four-week trial, Storm was convicted on one count, but the jury deadlocked on the other charges, leaving the potential for a retrial.

Galeotti’s comments are viewed by some as a signal that the DOJ may not pursue additional charges against Storm, especially if his involvement with Tornado Cash is deemed to be the result of developing neutral, decentralized software. Galeotti stated that if the evidence shows the software was designed to automate peer-to-peer transactions without third-party custody, new charges WOULD not be pursued.

Crypto Developers and the Need for Legal Clarity

The DOJ’s recent guidance has been welcomed by advocates within the crypto industry, who have long pushed for clearer legal frameworks that protect developers from unwarranted prosecution.

Galeotti’s remarks are seen as a step toward addressing these concerns and providing some assurance to the industry that developers who create open-source code with no criminal intent will not be treated as criminals.

Amanda Tuminelli, executive director of the DeFi Education Fund, echoed this sentiment, noting that the DOJ’s shift in policy affirms the industry’s stance that developers should not be held responsible for third-party misuse of their code. However, Tuminelli also pointed out that further work is needed to ensure permanent protections for developers through legislative changes.