adplus-dvertising
Business

Crypto developer found guilty of laundering $1.2 billion in illicit funds

A Russian crypto developer, Alexey Pertsev, founder of the now-sanctioned Tornado Cash Crypto Mixer, has been found guilty of laundering over $1.2 billion in illicit funds with his platform.

The 31-year-old man living in the Netherlands has been sentenced to 64 months in prison by a Dutch court. His lawyers can appeal the decision within 14 days.

According to CryptoPotato, Alexey was initially imprisoned in the Netherlands in 2022 when his creation, Tornado Cash, was sanctioned by the US. The US Treasury claimed Tornado Cash was a critical tool for the notorious North Korean hacking group, Lazarus. and has been used illicitly by the group.

During his trial prosecutors agreed that he didn’t do enough to stop criminals from using Tornado cash and his creation had been used by criminals to funnel illicit funds.

However, the defense argued that Tornado Cash operates an open source and automated smart contracts and it was a bit harsh and unfair to blame the founder for the actions of intentional and anonymous users of the platform.

Several industry commentators shared the sentiment of the defense counsel including Raphaël Bloch, co-founder of ‘The Big Whale, who highlighted the dangerous precedent the decision to find Alexey guilty of money laundering was setting. He added that his only crime was to develop an open-sourced tool.

“Tornado Cash dev Alexey Pertsev found guilty of money laundering by a Dutch court. This decision is very dangerous because Pertsev only developed an open-source tool. Condemning him is like condemning a knife or car manufacturer whose users would have behaved in a wrong way.” Bloch tweeted.

The outcome of his trial could set a dangerous precedent for other pending trials which include Roman Storm, Roman Semenov, and two other developers of the crypto mixer who are also accused of money laundering and violating sanctions in the US.

Meanwhile, Storm’s trial is scheduled for September, but Semenov has not been arrested yet. Former NSA whistleblower Edward Snowden had previously publicly endorsed Storm’s plea for support for his legal defense.

Following the conviction of the Tornado Cash founder, Blockfence’s Head of Security Research, Pablo Sabbatella called it a sad day for Open source and crypto.

What to know 

  • Tornado Cash is a non-custodial crypto mixing protocol, meaning that it never holds or controls the funds that are transferred via the protocol.
  • The Lazarus Group (also known as Guardians of Peace or Whois Team) is a hacker group made up of an unknown number of individuals, alleged to be run by the government of North Korea. While not much is known about the Lazarus Group, researchers have attributed many cyberattacks to them between 2010 and 2021.
  • Tornado Cash caught the attention of the US authorities after it was allegedly used by the Lazarus group

 


Follow us for Breaking News and Market Intelligence.
play store banner app store banner whatsapp banner telegram banner

Back to top button