Background: Paradigm is a well-known cryptocurrency venture capital firm that recently submitted an amicus curiae brief on behalf of Tornado Cash co-founder Roman Storm to support his upcoming trial starting on July 14.

Main Event: In the brief, Paradigm pointed out that the prosecution's characterization of Storm's peer-to-peer cryptocurrency software as illegal money transmission is incorrect, stating that this case could affect the future of software development in the United States. Paradigm emphasized that developers releasing software should not be regarded as money transmitters, and the jury must confirm whether Storm knowingly engaged in criminal money transmission through his software to convict him.

Case Progress: Storm is charged with conspiracy to commit money laundering and violating sanctions regulations. He is currently raising 2 million USD for legal defense, with the Ethereum Foundation donating 500 thousand USD in support. The prosecution has dropped some charges but continues to pursue money laundering and violations of the International Emergency Economic Powers Act.

Potential Impact: The verdict in this case may have far-reaching effects on the decentralized finance (DeFi) and software development sectors. Storm himself stated that if he loses, the dream of DeFi will be shattered.

Special Note: The article mentions SoSoValue.

TORN

Prominent crypto venture capital firm Paradigm has filed an amicus curiae brief in support of Tornado Cash co-founder Roman Storm ahead of his trial set for July 14.In a blog post published Tuesday, Paradigm's chief legal officer and general counsel wrote that the firm filed the amicus brief on Friday, noting that Storm's case could "dictate the future of software development in the United States."Paradigm argued that prosecutors are wrong to claim Storm's peer-to-peer cryptocurrency software constitutes illegal money transmitting, calling the government's position "contrary to the plain text of the law, clear FinCEN guidance, and decades of case law.""The irrationality and unfairness of these charges cannot be overstated," Paradigm said. "The Treasury Department has long recognized that developers who publish software are not money transmitters."An amicus curiae brief, also known as a "friend of the court" filing, is a legal document that enables non-parties with a significant stake in the outcome of a case to present their arguments to the court.In the amicus brief, Paradigm argued the jury must find beyond a reasonable doubt that Storm knowingly operated a money-transmitting business, transmitted funds on behalf of the public, and knowingly handled the specific criminal proceeds alleged by prosecutors."The jury must be correctly instructed that they cannot convict unless Storm knew the specific funds transmitted were derived from criminal activity," Paradigm said.Storm was charged in 2023 with conspiracy to commit money laundering and sanctions violations in operating Tornado Cash.Storm is currently fundraising for his legal defense ahead of his July 14 trial in New York, aiming to raise $2 million, according to a post on X. The Ethereum Foundation announced a $500,000 donation to support Storm on Friday."I poured my soul into Tornado Cash — software that's non-custodial, trustless, permissionless, immutable, unstoppable," Storm said in a separate X post on Friday. "If I lose, DeFi dies with me. The dream of financial freedom, the code I believed in — it all fades into darkness."Last month, the prosecutors announced that they would drop part of Storm's charges related to an allegation of operating an unlicensed money-transmitting business. However, they plan to move forward with money laundering charges — some tied to unlicensed money transmitting — and a conspiracy charge for violating the International Emergency Economic Powers Act.The Treasury Department's Office of Foreign Assets Control sanctioned Tornado Cash in 2022,but the sanction waslifted in March ofthis year.

Paradigm submitted an amicus brief to the court on behalf of Roman Storm, co-founder of Tornado Cash, warning that the case could impact software development in the United States.