Solana Policy Institute Backs Tornado Cash Devs with $500K Legal Defense Fund

Solana doubles down on crypto's most controversial legal battle.

The Funding Stand

Half a million dollars now shields developers facing unprecedented regulatory pushback. This isn't charity—it's a strategic move in crypto's ongoing war for financial privacy.

Legal Firepower

The institute's backing transforms scattered defense efforts into coordinated opposition. That $500,000 doesn't just pay lawyers—it buys precedent, challenges overreach, and potentially rewrites the rulebook for decentralized protocols.

Market Implications

While traditional finance still struggles with basic blockchain compliance, crypto's building its own legal infrastructure—because apparently regulators would rather sue developers than understand the technology. The irony? That $500K defense might do more for financial innovation than another decade of bureaucratic hearings.

TLDR

• Solana Policy Institute pledged $500K for the legal defense of Tornado Cash developers Storm and Pertsev.
• Roman Storm and Alexey Pertsev were convicted for their roles in creating the Tornado Cash protocol.
• Tornado Cash enables anonymous crypto transactions using open-source, decentralized smart contracts.
• Privacy Cash, a Tornado-like tool, launched on Solana, offering untraceable crypto transfers.

The solana Policy Institute has committed $500,000 to support the legal defense of Tornado Cash developers Roman Storm and Alexey Pertsev. The donation comes as both developers face criminal convictions related to their work on the Ethereum-based privacy protocol. This move adds to the broader industry debate on developer responsibility and software freedom, particularly regarding open-source blockchain technology.

Developers Convicted Over Use of Privacy Protocol

Roman Storm and Alexey Pertsev helped create Tornado Cash, a protocol designed to mix and anonymize Ethereum transactions. Once the smart contracts were deployed, they were made Immutable and no longer controlled by the developers. This design was intended to remove centralized authority over the protocol.

However, courts in the Netherlands and the United States have ruled against both developers. Pertsev was convicted in 2024 for money laundering. Storm was found guilty earlier in August 2025 for operating an unlicensed money-transmitting business. Authorities argued that Tornado Cash was used by bad actors to hide illicit funds, including proceeds from hacks and fraud.

The convictions have sparked ongoing debate in the crypto space. Many developers and advocates argue that once open-source code is deployed and cannot be changed, the original coders should not be held responsible for how others use it.

Solana Policy Institute Steps in with Legal Support

The Solana Policy Institute (SPI) announced its donation on August 28. The $500,000 will go toward legal fees for Storm and Pertsev as they continue their legal battles. SPI said this funding aims to support the rights of developers to build decentralized, permissionless tools without fear of prosecution.

Kristin Smith, president of SPI, stated, “Privacy is normal. Code is speech. And at Solana Institute, we’ll continue to defend the rights of software developers everywhere.”

SPI’s position is that punishing developers for third-party usage of software could slow down progress in the blockchain and software industries. Many in the space share the concern that such legal actions may discourage innovation, especially when developers no longer control how their protocols are used.

Tornado Cash-Like Platform Launches on Solana

Just one day before SPI’s announcement, a privacy tool similar to Tornado Cash launched on the Solana blockchain. Named Privacy Cash, the tool allows users to send assets to new wallets without linking their previous transactions.

According to Mert Mumtaz, CEO of Helius Labs, the tool works in a way similar to Tornado Cash but is enhanced by Solana’s faster processing and built-in block explorers. He noted that using Solana’s infrastructure, combined with privacy-focused cryptocurrencies like Zcash, offers users a high level of transaction privacy.

The launch of Privacy Cash suggests a growing interest in on-chain privacy tools, even as legal challenges for developers continue. Some blockchain developers say these tools are necessary to protect financial privacy in public ledger systems.

As legal debates continue, the support from SPI marks one of the largest public donations toward developer defense in the crypto space. This case is being closely followed by both legal experts and blockchain developers, as its outcome may influence how decentralized systems are built and regulated in the future.