Bitcoin Magazine
Tornado Cash Trial Day 2: Prosecution and Defense Tell Different Stores about Roman Storm
Today, during the second day of the Tornado Cash trial, the prosecution and defense provided opposing accounts in their opening statements for why the defendant in the case, Roman Storm, started Tornado Cash.
These statements were delivered after the jury selection process concluded.
The jury consists of seven women and five men; two members of the jury are in their 60s, four in their 40s, one in their 30s, and five in their 20s; and eight have undergraduate degrees, three have high school degrees and one has a master’s degree.
The members of the jury took the stand just after 2:00 p.m. EST, right before both the prosecution and defense delivered their opening statements.
The Opening Statement from the Prosecution
The prosecution delivered its opening statement first.
From the prosecution’s team, Mr. Mosley faced the jury and harped on the notion that Storm created Tornado Cash with the primary motivation of enriching himself — even if that meant doing so by helping to launder “dirty money.”
Mr. Mosley stated that hundreds of millions of dollars’ worth of crypto had been funneled through Tornado Cash, and that Storm and his co-conspirators, Roman Semenov and Alexey Pertsev, could have made Tornado Cash less attractive to criminals but chose not to.
He also cited how Tornado Cash facilitated sanctions violations, as North Korean hackers had used the service to launder crypto funds.
He implied that Storm was inherently guilty because he’d texted his co-founders in Tornado Cash “Guys, we’re done for” when the news surfaced that North Korean hackers used Tornado Cash to mix the funds stolen from the hack of online crypto game Axie Infinitiy as well as when Storm wore a T-shirt with a washing machine and a Tornado Cash logo on it to a crypto conference. (The defense, in its opening statement, admitted that Storm’s wearing such a T-shirt was done in “poor taste.”)
Mr. Mosley also stated that the evidence will show that Storm and his co-conspirators in Tornado Cash were intentionally running a crypto “washing machine” to help launder funds for bad actors and that it’s untrue the Storm and his co-conspirators were unable to make changes to the design of Tornado Cash once they learned that bad actors were using it, even though they claimed that they couldn’t.
“He chose to launder money time after time,” said Mr. Mosley of Storm.
Mr. Mosley added that Storm attempted to “hide his actions” by “cashing out” to the tune of millions of dollars using an account that wasn’t his own. (No details on whether this was a banking or crypto exchange account were provided.)
Finally, Mr. Mosley stated that the evidence in the case will include encrypted chats about the Tornado Cash business; the defendants’ communications with victims of crypto hacks, the funds for which flowed through Tornado Cash; and documents that show that Storm used someone else’s account in August 2022 to cash out.
The Opening Statement from the Defense
Ms. Axel, a member of the defense’s team, addressed the jury after Mr. Mosley.
She began by painting a picture of Storm as a hardworking immigrant with a penchant for computer programming, adding that he’s worked for a number of reputable tech companies, including Amazon.
She stated that Storm created Tornado Cash to help solve the problem of financial privacy when transacting on a public blockchain, and claimed that he had no association with any of the bad actors who used the service.
“Roman had nothing to do with the hacks and scams that the government was talking about,” said Ms. Axel. “Bad actors misused Tornado Cash to cover their tracks.”
Ms. Axel also shared how it was a conversation with Vitalik Buterin, the creator of Ethereum (the blockchain on which Tornado Cash is deployed), that inspired him to create Tornado Cash.
She recounted how Storm met Buterin at a conference and asked him what would be an important project to work on for Ethereum. According to Ms. Axel, Buterin told Storm that transactional privacy was an crucial problem to solve. Storm started developing Tornado Cash soon after.
Ms. Axel then walked the jury through a series of illustrations that explained how Ethereum works and how Tornado Cash anonymizes transactions on the network.
(While the defense distilled this information well, I can imagine it was still a bit confusing to the members of the jury, none of whom reported having any background in studying technology.)
Ms. Axel highlighted the fact that Tornado Cash never charged fees for the service, though it could have.
She added how even Buterin himself joined a “trustless ceremony” in May 2020 in which the first Tornado Cash test pool was initiated.
She also stated that once the Tornado Cash mixing pools were launched, Storm and his co-founders burned the keys to them, rendering the developers unable to have any control over what happened within the pools.
“The government’s case is about how Roman should have stopped hackers from using pools,” said Ms. Axel. “But he couldn’t do this.”
Ms. Axel concluded her opening statement by stating that Tornado Cash was nothing more than a tool that both bad and good people used — much like WhatsApp, Signal, a VPN or even a hammer.
The First Witness
Upon the conclusion of the opening statements, the prosecution called its first witness, a Ms. Lin, to the stand.
Ms. Lin detailed a scenario in which a scammer contacted her through WhatsApp and then LINE, another messaging app, convincing her to open a Crypto.com account and deposit a total of over $200,000 into it.
The scammer then walked Ms. Lin through the process of buying “crypto,” as Ms. Lin put it, before transferring that crypto to a shell company called NTU Capital, where Ms. Lin was able to view her portfolio, which she said increased in value soon after she deposited the funds.
The witness was dismissed before either she or the prosecution concluded the story, but given the purpose of the trial, one might assume that the funds were stolen from Ms. Lin and then put through Tornado Cash to be made untraceable. (To clarify, the latter half of the previous sentence is speculation.)
Tomorrow’s Schedule
The trial is set to resume tomorrow at 9 a.m. EST.
The prosecution informed the judge that it plans to bring at least three more witnesses to the stand tomorrow.
This post Tornado Cash Trial Day 2: Prosecution and Defense Tell Different Stores about Roman Storm first appeared on Bitcoin Magazine and is written by Frank Corva.