Roman Storm, founder of the Tornado Cash privacy tool, has warned that open source developers could face retroactive criminal risks from U.S. prosecutors for building non-custodial financial software.
His message resonated in the crypto community as his own legal battle moved forward. According to reports, the jury in Manhattan had a mixed result, revealing a high-stakes debate over whether releasing the code amounted to operating a money transfer business.
Storm asked DeFi developers, “How can we be sure that the Department of Justice will not prosecute us for building non-custodial protocols as money services businesses?”
Image: NDTV/X
Developers warn of retroactive risks
Storm argued that U.S. law provides little protection for people who publish software used by others to transfer funds, according to court filings and public statements. Based on the report, prosecutors called Tornado Cash a system that was used to launder more than $1 billion.
A question for current DeFi developers.
How do you avoid being accused by the Department of Justice of being an MSB for creating a non-custodial protocol and then accusing you of having created a custody protocol instead?
What if SDNY could charge developers for building non-custodial protocols?
Who…— Roman Storm🇺🇸🌪️ (@rstormsf) October 18, 2025
Storm’s team pushed back, arguing that blaming builders for users’ crimes would chill honest open source efforts, since the protocol is non-custodial and the software does not hold users’ funds.
Tornado: Jury divided on Manhattan charges
The jury was unable to reach agreement on other, more serious cases. While U.S. prosecutors have described the tool’s widespread illegal use, the defense has focused on the technical facts. In other words, no one was managing the protocol the way a bank manages an account.
The defense filed a motion for not guilty, asking the judge to consider whether the coders should be punished for how third parties use their copyrighted material.
Legal community sounds the alarm
Based on the report, lawyers and commentators, including prominent crypto law experts, have warned that if the prosecution’s theory is correct, the case could set a far-reaching precedent.
Some in the community have organized fundraisers to help the Tornado Cash founder’s legal costs. Some say the issue touches on free speech, because publishing code can be a form of expression, and holding authors criminally liable changes the number of people who write and share software.
Defensive moves and technical discussions
Storm’s team points to a decentralized and unsupervised design. They claim that the protocol’s code runs on a public blockchain and that no one is operating the service that stores funds in the usual sense.
Recent court filings address these themes and ask the judge to overturn the guilty verdict. Prosecutors counter that tools can be held legally liable if they are built and promoted in a way that foresees misuse.
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