Projects
![]()
No projects found
Investors
New
DAO Treasuries
DATs
Lend / Borrow APRs
Chains
Categories
Spaces
Tornado Cash: Week One
Recorded: July 20, 2025 Duration: 1:02:21Space Recording
Short Summary
The ongoing Tornado Cash trial has sparked significant discussions around privacy, software freedoms, and the legal implications for developers in the crypto space. Key figures like Amin Soleimani and Tim Clancy emphasize the importance of understanding the motivations behind privacy tools and the potential chilling effects on innovation in the industry.
Full Transcription
Thank you. Thank you. Thank you. Hey, Tim and Amin. First, hopefully you can hear me. This is David. Can you just request
speaker status? Go down to your menu and find that and I'll approve you.
Okay, great. Oh, I can also invite, I guess.
Hello, hello. Can you hear me?
Great. You can hear me, right, Tim?
Yep, I can hear you just fine.
Okay, cool.
Hopefully it's all good,
but I'm managing the speakers and speaking
because Lola needed to get to sleep, but hopefully
I got it under control. Amin, are you, can you hear us?
Yeah, can you hear me?
Oof, you got a turbo mic. admit turbo all right everybody we are um
All right, everybody, we are going to give it a couple more minutes before we get rolling here to talk about the first full week of proceedings in the Tornado Cash trial.
My name is David Z. Morris, and most of you in the room right now probably already know that.
So I'm actually just going to hold off a little while longer before we do an intro.
going to hold off a little while longer before we do an intro.
But since we've got the space,
anybody who's hanging out
have anything interesting to bring up?
Nothing too much
interesting, I suppose, since I've left New York.
Right, you're back in New Hampshire?
Yep, got home yesterday.
Nice.
So I have to ask, do you live in New Hampshire for political reasons or just by coincidence?
A little both. I'm from, I'm in New England there.
So my family's from Southern Mass originally.
So it's a nice, nice distance from home,
not too far, good area of the country.
But yes, I do appreciate some of the freedoms
that I am allowed to have in New Hampshire.
Okay, well, do we want to give it what do you guys think should we do you want to get going or
should we give a couple more minutes um okay okay you can have a good one i'll talk for a minute
before they show up can you hear my audio clearly?
I'd throw on some headphones.
Hopefully it helps with the feedback.
Can you tell if you're connected to the headphone microphone?
Because you're still, I don't know, you're still sounding very, like,
well, your sound is just not great.
I'm not sure what to say.
Okay, yeah, these headphones are just headphones, not mic. Okay, work or
should I try to find something? No, this sounds better. Just, um, yeah, I guess like speak in a
hot, you have really intense bass. So just maybe try and speak in a slightly higher register.
It'll be more audible. Okay, I think we're getting how many people do we have in here
uh i guess i guess we will go ahead and um at least get rolling here um
i uh my name is david morris i'm reporting on the Thank you. Did David cut out or is this just me?
Yeah, am I, can anybody else hear me?
What's going on?
Okay, so I'm seeing the people can hear me. Okay. Okay. But we will go ahead and, and
okay, I see. Okay. Apologies for the slight roughness here. I'm juggling a bit, but Tim, you should be back up. And can I just get our two guests
to introduce themselves and talk a little bit about,
I guess maybe what I would love to hear,
and we don't have to get into it,
but just like introduce yourselves
and maybe like highlight one or two things
about the trial so far that you'd like to talk about
over the next hour. So Amin, I mean, you want to just go ahead and jump in.
Um, hi, I'm, I mean, Soleimani as one of the summoners of Moloch Dow and, uh, was helping
with tornado cash early on, trying to get justice for our friends and help coordinate
the legal fundraiser. happy to be here and
participating and seeing uh justice in action um i think for for this week it's mostly the
prosecution is bringing their witnesses so uh we'll probably talk about that we can talk about
um some of the argue like the ways that the prosecution has tried to connect the case you know hacking cases to the
tornado cache that were kind of lame but yeah yeah
cool tim you want to just give yourself a yourself a quick intro uh yeah my name is tim clancy um i've
been an ethereum developer for a while and i'm you know really super uh intent
in following this case for roman just because of its you know implications for software freedoms
for all of us and um yeah i think specifically a lot of people saw the thread from tay going around
and there were some questions about like oh well, well, if they definitely didn't touch a tornado,
well, why didn't the defense object do this?
And I think a lot of people don't have a great idea
for how restricted the defense actually is
in terms of like the evidence that they were
and were not able to get admitted
and down to even just like the way
that Judge Fela is forcing them to avoid making certain arguments. So I think it might be
interesting to get into that just so people understand, quite frankly, how bad things really
are. Yeah. And on one aspect of that, I did listen to and write out the hearing on Friday, which I actually thought was somewhat of a positive
to break even for Roma's defense, having to do with their use of arguments for privacy in
mounting the defense. So we'll talk about that as well. But actually, I thought it would be
interesting to just really kick things off before we get into the guts of the trial exactly.
Tim, you on Wednesday, I believe, brought a book to the courthouse.
I was hoping you could just talk us through what this book is that you brought and kind of put it in the context of the current trial.
current trial yeah I would gladly so I don't know if anyone saw the video go
Yeah, I would gladly.
around but I brought a copy of Philip Zimmerman's PGP source code and
internals and for anyone who's not aware this is the book put out by MIT press
back during you know what what right now is really crypto wars one and the the
idea was back during the 90s, the US government classified
strong encryption as a munition. So it was export controlled. Developers were not allowed to
freely share it. And Philip Zimmerman actually was facing a criminal investigation for some time
with the great conclusion of Crypto Wars 1 basically being that computer code is protected as free speech because he wrote it all into a book and published that.
And you have strong First Amendment rights for that kind of publishing.
And, you know, again, I think it's relevant because this is, you know, not a defense that Roman's team is like able or attempting to make but like if he does go
to jail for creating this tool that um you know he had demonstrably no control over right upgrading
the smart contracts stopping went bad from using it it kind of runs counter to what
has historically been the protection for software developers in the United States.
has historically been the protection for software developers in the united states
And you put it really pithily in that video, Tim, on that exact point about the possible
implications about, I think you said something like, you should think about what project you
have worked on that might wind up in court or something to that effect.
Yeah, exactly. I mean, that's sort of where my personal something to that effect. Yeah, exactly.
I mean, that's sort of where my personal connection to this case comes from, right?
Like I've been a developer in Ethereum for at least as long as the, you know, Tornado
Cash guys were, but I wasn't working on anything particularly subversive.
You know, I wasn't as cypherpunk at the time.
I wasn't as talented at the time.
But I mean, I think anyone who knows
how to write a smart contract and anyone who had interest in these things and ZK Tech,
like very easily could have found themselves working on something like Tornado Cash and,
you know, end up being the ones getting persecuted by the state for it, quite frankly.
Yeah. And that's something that I will say say I think was well represented by the defense in their opening statements and we're going to get, you know, the full picture but they pointed to the fact and you know it's interesting to think about what this is going to mean for a jury of sort of normies but the defense pointed to the fact that Vitalik had encouraged Roman and the team to build this project, that it was really
enthusiastically received by the community, that it is this sort of, you know, frontier research
almost that's happening, which I think is also important to keep in mind in the context of
the freedom of speech question, right? Because this is computer science. This is sort of
frontier research. Yeah. And so you have a real risk of prior restraint
when you're putting these kinds of restrictions on people writing stuff that's exploring ideas,
essentially. Oh, absolutely. I mean, we've already seen just how much it's influenced
the development of privacy tools coming after, right? I mean, Amin can talk at length about what he's building,
which is almost entirely response to the fact that
we really can't have universal privacy anymore.
But even aside from that,
like you've already seen the chilling effect on people like Aztec
shutting down Aztec Connect right after.
And, you know, I definitely like,
I know a lot of privacy devs who are very concerned
about whether they're even able to legally release what they're working on. And that's just,
that's just kind of bad for all of us. Right. Yeah. And I do think one of my agenda items for
later in the call is to kind of talk about practical solutions, which I guess this is
probably where I mean, would definitely come in.
What do we do or how do we plan to live in a world
where either there is some victory condition,
so to speak, I'm not supposed to take sides,
but where there's a freedom of speech judgment
and this technology becomes widely available,
just like 3D printed guns are now, for example.
And in that situation, how do we then.
Can anyone still hear me or did I know that was no, that was that was me.
I'm I'm realizing the problem with my phone.'m sorry guys i it just went to sleep um okay so do we want to start amin do you want to try and take
a crack at giving some kind of overview of the prosecution witnesses so far you brought up
um these uh you know hack victims and things like that yeah i feel like that was a good introduction to like the case at large and the importance of it
uh not only for roman and his his future but for the rest of us too so thank you tim um uh so far
the prosecution has brought in a couple of witnesses.
So they started off with a nice old lady who had her, I don't know, hundreds of thousands
of dollars, 250 K I think life savings, uh, scammed by someone posing as her friend on
WhatsApp and a DM.
And then I think the website that she actually used to recover like she paid for a recovery service was also a scam
I'm not sure if I understand correctly. This is the thread that Tay
Research and wrote about is that the money from her
Never actually hit tornado cash, but somehow this recovery service told her to email tornado cash
And then there was this whole little like sidebar in the
court where like the judge turned to the jury and was like, the money may or may not have ever
actually gone into tornado cash, but that's not the point. The point is that she was told to talk
to tornado cash. And you know, this is the response she got. And tornado cash was like the only one
who actually responded to her. And they basically said, which was what, you know, I assumed to be true, which is
that they couldn't have done anything.
And the defense rightfully, you know, in their, uh, cross-examination pointed
out that, uh, you know, um, plaintiff, or I don't know what the victim, um, didn't
get any money back from FTX or coinbase or anywhere else that her money
was actually sent uh yeah that was a great moment that was one example uh and then they brought in
sorry i mean can i jump in real quick um just because i was i was fascinated i i saw taze
thread i didn't realize it was actually acknowledged in court um that this first this is the very first
witness i believe um and acknowledged in court that her money had maybe not gone to tornado
it wasn't i didn't actually realize why they did that at the time it was only after
published the thread i'm like oh this makes sense now that they like did this little conditional
thing yeah and i think it
was actually really insidious how it was done because i didn't i didn't necessarily catch it
at the time either no matter how involved i am so it brings up a question yeah i didn't realize
that's what it was even referring to like the jury probably just you know assumes that the money went
to tornado cash the jury the jury is whether or not they like it getting a crash course in blockchains uh
like from the opening statement there was blockchain diagrams networks of nodes you know
blocks of transactions like uh i hope i hope we're at least creating some believers out of this because
they figure it out um yeah they're a little well there's been a lot of concern about that.
And I think, you know, it's a valid concern that people would get kind of turned around on blockchain technology.
But I think that, well, my recent experience was covering the SafeMoon trial, which was also somewhat technical.
It had to do with locking a fund and things like that.
And I think that in that case i i felt like the jury
was following along pretty well and so i i'm hopeful that that doesn't become like a huge
um sticking point for them because i do think you know people might not get the intricacies but they
can get the big big picture most of the time yeah the other witnesses that the prosecution brought in was like uh an nft rug
puller uh and there was a pretty comical moment where the prosecution had to ask him like what
is a rug pull uh to like explain it for the benefit of the jury um and they asked them if he
had like ever you know they had all this like metaverse roadmap on their website.
And he's like,
did you have any intention to do any of this?
And he's like,
not at all.
and then explains how like you see his text to his girlfriend,
about how he's telling her how he's going to put the money in tornado cash.
And she's like,
Oh my God,
you do love me.
He replies like washi washi,
something like that. Uh, and there do love me. He replies like, washi washi, something like that.
And there was something else really interesting about that particular,
there was something really interesting about that testimony too, which was a, like they didn't even think about the idea of trying to conceal the funds until after they'd already executed the rug pull. And B specifically,
if I was interpreting some evidence correctly
about Google searches that he was making,
it didn't seem that he actually had ever even heard
of tornado cash until after this crime was committed,
which is seems quite interesting.
And he started getting flamed by his discord
for moving the money that he like realized that all of the stuff is transparent
Oh, what do we do now?
Man, that's incredible
Yeah
There is the CTO of axi of the company that makes axi infinity
Oh great. I actually missed this testimony
Yeah, that one was interesting.
He was lawyered up.
There was four lawyers with him when he entered and exited the courtroom.
I could tell he was prepared in his statements.
There are some things that he forgot about,
maybe like how the Axie Dow worked or was made.
It's an interesting thing to forget about through the CTO of a company. about maybe like how the Axie DAO worked or was made.
It's interesting thing to forget about through the CTO of a company,
whether or not their own DEX
or what they call the DEX was actually decentralized
or whether the validators worked the way they worked
for the Axie bridge.
And like some of the details of calling things decentralized the jury got a bit of an
education on like dows and nodes and they had to explain the the keys of the bridge and how axie
had four of them and it was like a five of nine and so they needed to get one other key and the
attacker had to go through the the computer that, they took over of the like DevOps engineer.
And they went and like convinced one of the Dow members to like use their
key because they were convinced in the communication channel that this DevOps
engineer had with the down member. And that's how they got all five keys.
So that's a good one into detail about that part.
Yeah, like I said, I missed that,
but he was under subpoena.
So he was legally obliged to be there.
So it makes sense he was really worried up
and quite buttoned up.
And then I'm not sure, was there anybody else
before that we kind of got
to the evidentiary interviews with like the FBI agents?
Yeah, there was Justin Brand came in and he was a member of the Tornado Cash kind of community
multi-sig for a while. And he was also, you know, subpoenaed and came in and agreed to testify in exchange for immunity.
And then the prosecution made a big deal of harping on,
why did you feel the need to ask for immunity?
And trying to just further paint tornado in a negative light.
Yeah, I mean, this is actually really a good thing that you flagged,
because when we're talking about liability for developers or things like that, it's not just that, right?
And we've seen this already with DAO cases, but it's liability for multi-sig holders, for anybody who is one of the decentralized managers.
Basically, you wind up on the hook for some of these things based on the way some of this is being interpreted.
Yeah, absolutely. basically you wind up on the hook for some of these things based on the way some of this is being interpreted yeah absolutely um and just before we move on if anyone wants i dropped in the uh comments here a link to the ether scan um you know the guy who did the nft rug pull if you
want to like actually see the transactions that he pulled off and it's it's like pretty comical
like the trial didn't go into how he was caught, but I'm sure it was fairly
evident because he was
funded by Coinbase,
and then two days after
sending the tornado money, also sent money
back into Coinbase.
So I don't know that it was a particularly
sophisticated incident.
It's incredible.
There's the other thing that is worth mentioning about him,
which is that uh and the
defense called this out in their opening statements that uh the prosecution has brought the perpetrators
of the crimes given them plea deals uh or like you know deals to like get them to you know testify
and so uh you know the new nuances that like how he testifies doesn't actually isn't, you know, they claim is not relevant to how his particular case will go, but that he does get a hearing and it is mentioned that he testified.
So it's supposed to somehow, you know, act positively for him to saying that he's cooperating.
but saying that he's cooperating. So yeah, also great.
So, yeah, also great.
And then I guess the, that was, I'm sorry, I'm tripping over my words. Were there any other
uh victims that day i'm just having trouble remembering everything
victims that day? I'm just having trouble remembering everything.
or i say victims of you know unrelated scams to be clear um i don't think oh tim go ahead yeah i
don't i don't think they brought in any additional victims after that they just had the fbi agent
over like 16 cases and read three hours of transactions from hacks that were like transaction
one and then it went to this wallet and then it went to tornado cash, you know,
and like going transaction by transaction, just, uh, admitting it there,
there are basically two testimonies from like agents.
One was the guy who went to the Netherlands, got the, um, you know,
processed Alexi's phone data and like grabbed all the messages. Um,
and then the other one was the special agent at the FBI who traces all the
to the tornado cache.
That's the one that we're off on.
Who did we miss?
Before we get into that,
we did forget.
right.
I missed the guy in the morning who raided his house.
But there was a, it was a BitMart lawyer that I did forget about who was another example.
true.
He was the victim.
He was representing the victims. Yeah, he example of the victim. He was representing the victims.
Yeah, he was representing the victims.
He showed his demand letter.
Yeah, his demand letter
for IP addresses,
social connections, and it's like
they also at some point put up
a piece of evidence that was the docs
that showed that Tornado had a no-logging
policy, so it's like
I don't think they actually had any
of the things that the you know bitmart demand letter guy was after right that was a question
i mean i i'm assuming that tornado cash does not i mean maybe through the front end they would have
had ip addresses or no uh i like they might not have like kept it for long i don't know they're
like hosting provider like like cloud flare,
whoever's enforcing the sanctions might have it.
But yeah,
but that was an interesting point from that letter.
Cause defense did work on the fact with bitmart lawyer that,
you know,
did you receive a response from any exchange?
And it was,
yeah.
Did you receive a response?
None of the other people like the defense cross reference about the same
thing again, as they did the other guy. And the defense cross-reference about the same thing again
as they did the other guy.
And they said, you know, same answer,
which was like, no,
nobody else answered me either.
Right.
So it's like Tornado Cash
were the only people
who were actually responding,
even though the response was not
what the victims wanted to hear,
but it was, you know,
hey, we have no control over these funds.
But yeah, to the point of like,
could they have handed over ip addresses
it's like well bitmart sent the same message to cloudflare and aws and was just outright ignored
and so it's you know yeah oh true um so i do want to yeah after this basically we got i think it
was actually a total of four different witnesses whose role was basically to establish evidence prior to the discussion of the evidence, maybe with other witnesses.
This was, yes, an FBI agent who went to the Netherlands to retrieve messages pulled from.
Let me get this right.
But is it Roman Semenov's phone or Alexei Pertsev's phone?
I think it's Pertsev, right?
Alexei's phone, yeah. Pertsev's phone? I think it's Pertsev, right? Alexey's phone, yeah.
Okay, Alexey's phone.
He's also here with IRS and not FBI.
Yeah, okay.
And just to sort of explain very quickly the significance of that,
one of the really interesting pretrial issues was that telegram messages
that were pulled off of Alexey Pertcev's phone had some sort of data
error basically that removed information indicating that they were forwarded. And in the charging
documents, there was a quote used of a message having to do with how do we launder $600 million
or I have an inquiry about how to launder $600 million. They attributed this
to Percev, which made it sound really malicious. But in fact, because of this data error, this was
a message being forwarded by Percev from a Coindesk reporter who was asking a reporting question.
And so this was part of the evidence that went to the grand jury in order to initiate the indictment. And it's completely on false pretenses.
This has been sort of corrected in court, but it did come up in the discussion of the phone
because another point the defense made was that this agent who went to the Netherlands to get the phone information
did not actually get it directly from the phone.
He was given a file by Dutch authorities,
a copy of the phone, and he, you know, I think can be reasonably expected to have authenticated that. But nonetheless, it was a fact that he discussed that he actually had not
taken the, he had not seen the phone, in fact, according to questioning by the defense.
Amin, go for it. There was a really just a funny moment where brian
klein roman's lawyer had like a message from him i think to like i don't know it might have it was
also maybe in evidence but it was he was basically trying to get the judge to impeach this witness
and say that his testimony is invalid and should be thrown out because he previously had said that he had processed it
or that the Dutch had processed it,
and now he was saying he had processed it.
And so he was willing to show the judge this email,
and the judge just didn't give a shit and threw it out
and was like, move on, please.
We're not impeaching people on this.
It's kind of funny. didn't give a shit and threw it out and was like, move on, please. We're not impeaching people on this. Um,
I think the point was pretty thoroughly made.
Yeah. I think, I think the point was pretty thoroughly made, but, um, yeah, it was interesting to see that cut off.
Yeah. The,
the judge has denied basically every objection that the defense has thrown out,
uh, for any evidence being admitted.
And the prosecution objected to the use of privacy being discussed.
Do you guys want to talk about that briefly?
You know what?
Let's actually hold off on that.
Let's talk through the last couple witnesses, and then we'll get to that particular question
because that was decided in the hearing on friday so i'm kind of like going in
chronological order um but just to um blow through one other witness here um there was also the um
which i i was the most amused by and i mean i hate to say it because it was really a tough
morning for her but the fbi agent who came in to discuss her forensic analysis of the PepperSec corporate
bank statements. I mean, this is the truth about going to a court case is that it's never actually
like a movie or like a TV show. But this was a moment where it was legitimately like a TV show
because this FBI
forensic accountant who had gone through the bank statements went up, testified for the prosecution,
walking through these three pie charts that showed PepperSec spending. And kind of the agenda
being laid out here was to show that Roman and other PepperSec employees had made money putting out this product.
And it was actually kind of funny because the salaries they were paying themselves were
ridiculously low by any sort of crypto or tech world standard. So we did learn that.
But the interesting part came on cross-examination by the defense when the defense attorneys pointed out that these pie charts did not add up to 100%
for unclear reasons. One of them added up to 99%. One of them added up to 104%. And I think the
other one was a little bit confusing in a different way. But what was fascinating was this FBI agent
basically went into lockdown and started saying that she couldn't remember the answers to any of the questions because she needed to refer back to her spreadsheets, the original spreadsheets that the charts were based on, which she didn't have and hadn't brought.
So that was interesting to see.
Did you guys have thoughts about that particular witness?
I'll have to refer to my spreadsheet.
I mean, those who were there, that was your go-to stonewalling line. And it was,
you know, this, this spreadsheet that wasn't even in evidence. Like, I think the defense made it
pretty clear that they'd never seen this spreadsheet.
This was something that was FBI internal
and is what led to the inevitable defects in her charts.
But just also, generally,
and I hope the jury got the same read
that we did sitting there.
This was a witness who clearly was there to
like i am i am team prosecution they literally work for the fbi i'm not you know going to say
anything and oh i forgot everything as soon as it's time to be cross-examined right yeah he was
pretty desperately uh like to the credit of like the axie guy and justin bram like the people who
are subpoenaed there and like they're unwillingly were, you know, answering questions like fairly honestly and frankly.
But, you know, the FBI are not there to try and help the defense whatsoever.
Yeah. Yeah. Very good point.
And then I believe after that we got two folks.
We got a...
Or maybe we just got one.
Did we just get the blockchain analytics guy after that?
Or am I missing something?
We got the raid on Roman's house, which was...
Oh, okay.
That had its own moments of comedy.
Entirely, yeah.
Entirely a stunt to present the picture of Roman's house, which is a nice home, but I assume not extravagant for a Seattle area home.
And then his shitty little neon sign, which I think you wrote very eloquently about it being...
This wasn't like his malicious kingpin moment.
This was, you know, he's an aspirational small businessman
and paying himself in his team of six people.
Like they burned through less than half of the VC money that they raised.
It was really quite modest spend for any technology company, let alone crypto.
And then here was his like cute little tornado cash sign.
Yeah. Yeah. And I just actually really quickly want to, you've, you've reminded me of something very important that I forgot with
the FBI bank analyst, which was, you know, she had, you know, brought up in the earlier part of
her testimony that when you're looking at money laundering cases, what you're often looking for,
well, the defense, the process, the defense elicited this testimony from her that
one of the signs of looking for money laundering in a bank account is either big deposits or big
withdrawals of cash. And then they sort of went through a lot of her testimony. They asked her
then, were there big deposits or withdrawals of cash from this bank account? No, there were not. No, there were not. There were none of the objective signs of money laundering on that side of the equation. And in
fact, as we got to the bottom of the ledger, it was seen that the only money that had actually,
in practical terms, except for a couple of refunds, the only money that had ever come into
this account was a deposit of $100,000
from Dragonfly Capital. So they were just spending VC money and this bank account was being presented
as sort of forensic evidence. Oh yeah. And then this is the other one, right? Where I think there
were some objections that were, you know, Judge Fela allowed them to be sustained, but it was,
judge fail allowed them to be sustained but it was you know uh is this payment to the olympia
state department of tax payments for washington a tax payment right is this payment to a lawyer
a legal expense right it was the defense like clearly trying to demonstrate to the jury that
despite the fbi showing these comically bad charts that were like, they spent this much on crypto and this much on payroll, right?
Like, you know, and the defense did bring up,
although we were not allowed to see it because it was not allowed to be
admitted, but like previous versions of the charts showed a more like
legitimate breakdown of the business expense that had normal,
like business categories, like, like legal expenses,
taxes and showed that you know tornado cash was
or pepper sec or you know the engineering company behind tornado cash was operating in like a totally
above board normal way right like they were they were paying taxes they paid lawyers they were doing
their filing um but of course yeah yeah it had to be teased out it was like it was like pulling teeth
watching that witness just forget everything,
forget how to read. Yeah, yeah, absolutely. And it's interesting you put it in that context.
It's a good example, though, of I think that the defense is doing a good job of pulling these
things out and making that opposite, painting that opposite picture, I guess. And that brings
us back to,
you know, what you brought up with the neon sign. They walked through this physical raid on Roman's
house. You know, I think it's, you're right, you know, nice house, but, and I mean, that might be
one interesting point where it's to a New Yorker, that definitely looks like a mansion, but not
really in anywhere else in the United States. But the neon sign was
interesting because they sort of foreshadowed the neon sign. And I was sort of expecting some big,
like Scarface caliber installation on the wall, like actual glass neon for one thing. But the
sign wasn't even actually neon. It was just a little plastic LED thing that was about, I would honestly say, like one foot by two feet at the most.
And you could easily hold it in one hand. And they actually had the sign in court, plugged it in and lit it up, which I, you know, I just, as I wrote, it just seemed to make honestly the opposite impression that they intended. It just seemed underwhelming and certainly had no like kingpin vibes about it whatsoever. So that was another interesting moment.
Tim, I mean, I think we're getting to the part where maybe we can talk about some of the motions that went on and especially having to do with
privacy. So what were y'all's, first of all, I was able to listen to the call on Friday to talk
about the privacy issue. I don't know if y'all did, but what was your takeaway on that front?
I wasn't, maybe you can give the, I sort of heard secondhand the recap, but maybe you can give the update.
Okay.
So I actually thought the hearing on Friday was pretty, was kind of a balanced take, a good judgment, I would say.
At the root of the issue was that on Tuesday or early, I think it was Tuesday, during opening statements, the defense was sort of laying out a hypothetical for the jury asking, you know, what if your bank account was transparent for everybody to see?
Can you see how that would be bad?
And at a certain point, the defense lawyer used the specific phrase right to privacy.
used the specific phrase right to privacy. And this gets into sort of constitutional issues that
the judge has previously ruled. And this is also, you know, the reason the First Amendment issue is
not actually going to come up during the trial is that they're kind of excluded from the scope
of the trial here, and they would have to be heard on appeal. And the privacy issue is kind of in that
ballpark. But the way that the judgment went down on Friday with regards to this was that Judge
Fyla very specifically said, you know, when I excluded this initially, I certainly did
not expect it to mean that the defense could not discuss the concept of privacy, and especially having to do with the state of Roman Storm's mental state, that
Roman's intent when building this thing is actually very material to the charge.
And so what we wound up with is that the defense will actually be able to talk about privacy
insofar as it is a motivating matter of, you know, why Roman pursued this,
which I thought was fairly good. Basically, the defense just can't use the specific language
right to privacy. And that's just because, I mean, it's not just because, but there is a
legitimate reason there having to do with, I don't know if anybody
knows a lot about jury nullification, but it's a larger legal issue. I'm not completely tuned in.
But the concern is about jury nullification, but they can definitely still discuss privacy as kind
of a feature and potentially something that a non-criminal would want to use.
Amin?
Yeah, that's just a really good sign because a lot of their motivation is to create a tool for
advancing privacy for the reasons of providing safety and security to people. And like it's misused by the criminals is why we are here today.
But you know, and so far as privacy is a thing
that is good for people and that can be a motivation
for developers not to, you know, want to do crime.
Like in the opening statements,
not opening statements,
that it was in the Justin Bram testimony
where it was the community manager for tornado
the brian the defense lawyer asked him like did they teach you did they ask you to make
educational material for north korea did they ask you to make educational material for criminals
uh just to kind of explain that they didn't, and that wasn't their motivation. So
I think that's a good sign. Yeah. And I think it's also important to remember
evidentiary standards in a criminal trial. All the defense has to do is establish a reasonable doubt
that their intent was criminal, and the jury will have to acquit him. So I think that that's,
or, you know, at least in theory. Tim, did you have any thoughts on the privacy as a matter of
the trial? No, I also hadn't attended that pretrial phone call, but I am happy, you know,
mostly from your reporting is how I've been, following the learning that Judge Phelan like also did not intend to have such an extremely restrictive view of it.
Have we talked about the T-shirt at all?
Right.
Yeah, let's get to the T-shirt.
Just one quick note.
Yes.
One quick note.
I think we're going to set aside the last 10 minutes of this call for questions. And so just hold on to your questions for a couple more minutes and we'll open the floor. Yeah. So let me let me hit this one real quick, because it is in the context of criminal intent. Right. And I have to say, from my perspective, I felt like this was the one thing that was probably worst for Roman. And I think that there's a lesson here in terms of kind of public presentation because
you know, they have, and it was a logo that tornado cash used a few times, including on
a t-shirt that was a washing machine.
And unfortunately that does have criminal connotations from my reading.
I don't know what everybody else's take there is,
but I felt that was somewhat damaging, even though, and I think that we got a preview of
the argument that the defense is going to make in opening statements. They sort of said,
you're going to hear about this t-shirt. It was a meme. It was a joke. Like, it was just a joke
is, I think, going to be the defense's response there. But I do think it provides really, I mean,
I think arguably the only concrete hint of criminal intent that we've seen for
the trial so far is that t-shirt, but I might be,
I might have the wrong take too. Tim, what do you think?
Yeah. I mean, realistically,
it's like they could make any of us look like criminals if, you know,
a highly funded government agent
decided to uh cherry pick through all of our group chats i've certainly said some heinous things and
you know i might i could be painted any number of ways the t-shirt yeah it's a bad look um but it's
hilarious it's like objectively a funny thing to do and i and i don't think you know at the time right
they're running a an above board reasonable business they have a compliance section on
the website like they're you know not laundering shit loads of money for hacks at this time um
yeah i mean i i agree well that is an interesting point about timing yeah yeah i mean this was early
on in their history as well.
So like,
it just depends if the jury is going to be a bunch of pro clutchers about
that one or not,
to be honest.
Like,
I think,
you know,
just to be clear,
like the t-shirt thing was like end of 2019.
So it was like pretty early on in the tornado life.
Like youth was like 200 bucks,
then 150 bucks bucks something like that
you know like that we hadn't had d5 summer 2020 made it immutable immutable was like may and then
it took took off like largely after that um if the t-shirt thing is ever relevant uh i'm gonna have
certainly a bad time because of the uh i helped violate international sanctions and all I got was
a slimy t-shirt.
I've, I've worn that t-shirt to all sorts of conferences, right?
Yeah.
It's, it's a, it's a nice t-shirt.
Um, I hope he doesn't get in trouble for, for that joke.
Well, I think you, I think you make a good point there with the, with your other example,
which is, I think, again, the argument is perhaps, you know, not just that
it was a joke, but that this is freedom of speech, that it's commentary on the system itself.
If I may, it's like, like, he literally thought he was following the law, right? Like, if he had
asked any lawyers, right, they would be like, I'm, you know, like, what does FinCEN guidance say?
You're not a money services business. You don't need these, you know, kind of checks you know, like, what does FinCEN guidance say? You're not a money services business.
You don't need these, you know, kind of checks.
So, like, they had lawyers all throughout this process, you know.
Yeah. I don't think they thought that they were committing crimes, you know.
They were acting in the open, you know.
Yeah, and hopefully the defense makes that case.
Yeah.
Tim? Yeah, I mean, I am curious
if once the defense starts to bring witnesses
if there is going to be a defensive council
argument that these guys did very
much think they were operating above board
and try hard to operate above board.
But even just the very last piece of evidence,
I left on the
Thursday afternoon session where DeCaprio was just going to be going through a bunch of forensic stuff.
But I think that's what they introduced one of the messages from Roman Semenov that was like they were upset about bad money coming in and fucking up the stats.
And like I thought it was interesting that they harped on that and that the prosecution tried to make it look like they only cared about, like, appearances.
But I sort of interpreted that to be, like, Tornado Cash guys cared very deeply about, like, the majority of the funds in Tornado Cash being, like, clearly not criminal in nature, clearly being, like, honest users.
Like, they were, you know, you can argue that the T-shirt showed, like, they didn't give a shit about criminals using their product.
But, like, that message shows they were also like very very concerned about like their image as well and
you know like it sort of goes both ways yeah you can make these funny jokes but at the end of the
day they did want to build an honest tool for normal people yeah and and if that's that's the
interpretation that kind of the framing makes makes all the difference um i want to go really
quickly into one other um motion and resolution that I
thought was pretty interesting, and then we'll open it up to questions. If anybody has a question,
you can now start putting in requests for just to get on the mic for a second. And if you also
could like put up the hand raised emoji, I think they still have that. But give me one second here. The other motion that was relevant
had to do with the prosecution sort of objected to the defense's use of the example of kidnappings
that we've seen recently happening to major crypto holders, kidnappings and blackmail. And
the concern was that one way to put it is this is prejudicial, that it's like so inflammatory and so dramatic that it doesn't actually illustrate the point, which has to do with privacy.
Roman Storm's way, Judge Filo ruled that if such kidnappings and other sort of like privacy violation based physical harm or other major things happened that had actually influenced Roman to build this tool, that those were then relevant to, again, this criminal intent question.
relevant to, again, this criminal intent question. So she ruled that those could be admitted as long
as they were plausibly part of his motivation. And so that does mean that the defense can't
cite events that happened after Roman operated tornado, built or operated tornado cash. So for
example, if somebody was kidnapped or blackmailed in 2025, that probably
wouldn't be relevant to his mindset in 2019, 2020, 2021. But other than that, they are able to bring
up these incidents in the context again of mindset. Tim, did you want to comment on that?
Yeah, I did see that nuance made. And I think this is where there was a lot of chatter where
people were talking specifically about like DEFCON 3 you know i think that's where a lot of the original tornado cache like i think i think the
tornado guys attended that maybe that's where tornado cache got started but i'm i'm not super
aware on the history and this might have been part of the tape red as well but it was like
you know this is when eath started to pump really for the first time and suddenly you had like a lot
of people who were very concerned about their safety and so i do think that even though like the uh ledger founder getting his finger chopped off and
like everything going on in paris right now can't be uh used as indicative of roman state of mind
making tornado cash there were definitely you know safety concerns even early on in ethereum's
history yeah and that was actually one of my questions was,
is there, are there examples that are earlier?
And so it sounds like there definitely are.
So we will go ahead and take,
I think we only, it looks like we only have one person
looking to get a question in, but would Peter,
Peter Mentemple, want to go ahead and
yeah comment or question
guys
I was in the court a couple of days last week
I was there for Thursday which I thought was pretty
good oh hi Peter now I recognize
what's up
so my actually
question and comment is regarding the elements of money laundering.
I put them in the chat, and I don't think that they're going to be able to get there to sustain it.
Specifically, if you – let me go – I'm going to read it real quick.
So specifically, it says that to be convicted of money laundering, the prosecution must prove several key elements.
These include the proceeds of unlawful activity, the defendant's knowledge of the unlawful origin and the intent to launder.
So you could argue that he there was knowledge, right?
That's what they were putting on. They were trying to produce evidence of that the other day with the Google searches, right? The hack happens.
He then searches like within a few days or hours of the hack happening.
Now they're saying he has knowledge, but all of this is already, everything is already
set in stone, right?
So he already made the program.
He already made tornado cash.
He can't go back and reverse it.
So this is where the charging instruction to the jury is going to be so important, right?
And the jurors then being able to discern and say, wait a second, he made this before
the fact, and there's no evidence that we're seeing adduced, which is, it goes to the point
you guys just brought up that he did this because he wanted to help people launder money.
He literally, it was put in,
it was,
it was, uh,
put out at the trial the other day that he had a conversation with,
Vitalik.
And so he had the conversation with Vitalik before he created.
Right.
So there's the,
there's your intent right there.
So I,
I think they're going to have a prosecution is going to have a real problem
with the jury when it comes to this.
And there is an important consideration.
They just did a filing the prosecution to respond to the defense motion from Friday, trying to eliminate this expert witnesses hypothetical from from the jury's purview.
Right. Saying that he could have altered the code to make it harder, but he didn't.
Hypothetically, he could have and uh i guess
we'll see tomorrow um what judge phela is going to decide on that but i think the privacy issue
is one that's that's paramount here as as well as first amendment and you know you see these
in a lot of cases these these federal rules of criminal procedure really handcuff defense attorneys.
And it's basically like you're playing against a, you know, a stacked deck or it's a rigged game.
These are issues that the jury, as the finders of fact, is supposed to be deciding.
Now, jury nullification, the court has said time and again, is not allowed, right?
Because the judge is the one who decides what the law is, that the jury shouldn't be subverting the judge to decide the law. But, you know, I take a different
opinion of it, man. I mean, like the jury is the American public, right? And so they should decide,
well, should this be illegal or not, and make a decision about that? And you see that in a lot of
cases. Yeah, yeah. And just to sort of like drill in a little bit
on that with, you know, I'm not intimately familiar with jury nullification, but what I do
know is the way that, you know, in probably two weeks the judge will lay out exactly what
the legal parameters of each charge are. And it is definitely in her hands to not exactly define,
but certainly to lay out in very clear terms, what qualifies as what kinds of behavior.
And, and I think that will be pretty key to what you also brought up, Peter, having to do with the
sequence of events, right? And, and I do wonder, because I wonder, because I'm not super familiar with the intricacies of
it either, but I wonder how much instruction the jury will get on the question of criminal intent
and what the details of that instruction will be. I think that's going to be pretty crucial
looking at what I've seen so far. Peter, did you want to respond?
Yeah, I was going to say, just really quick, I think closing arguments are going to be,
well, obviously it is closing arguments, so it's important, but I just finished watching
the Diddy trial, and I watched Agnifilo give his closing argument, and he was able to dance
very close to the line to getting in things that basically made the jury decide a certain
way that you could have considered nullification.
And it was motions that were denied before trial that they're not allowed to introduce the question of why the prosecution is even charging this case in the first place.
So I think that there's a delicate dance that needs to be done.
But I do think that that will come in at the close where the jury, you know, needs to have
the courage to look at this and say,
do you think that privacy should be part
of the American system or not?
Yeah, I think that's very fair.
I will say, well, actually first, Amin,
did you wanna jump in on that a little bit?
Yeah, I just wanted to add something
to what Peter was saying,
because there is a whole part where the prosecution is
trying to describe roman's uh you know actions as active like he laundered the money he was operating
tornado cash as a service this was a business uh when you know the volume spiked like they did a
lot of business that day these are all ways that the prosecution has described tornado cash, whereas the defense is mostly talking about what they
couldn't control. You know, they locked it, they were locked out of the smart contracts, it was
immutable. You know, even if they'd updated the UI, like people could use other routes around it,
so it wouldn't have mattered. And it's sort of like that's part
of what's on trial uh is like how active he was and the prosecution basically wants to
draw a big circle around tornado cash and say everything the ui you know all the the relayers
everything was part of their business and so um that's that's part of what needs to be decided by the jury in terms of showing that
he was not, you know, Roman was not collaborating essentially with the criminals that were
laundering money. And so then he personally had no intent to launder them. Yeah, that's going to
be the key issue. I have to say, I have to, I've kind of a hard out. I don't know if anybody wants to take over as co-host. I can I can if, you know, Tim or I mean, if you want to stick around and keep everybody talking, that's totally fine or we can call it. Does anybody want to anybody volunteer?
it does anybody want to anybody volunteer thank you so much for your time right on yeah i think
i've got to run too so uh okay sorry i can't keep this one running well we will be doing more of
these um and uh there will be more um obviously coverage coming from the rage um so uh keep that
in mind and also um just just to give a shout out we're you know this is just kind of a general thing at this point but the rage is um entirely community funded at this point so just be aware of that and
we're you know you know there there could be other stuff coming up so um i hope everybody got some
value out of this um and uh and all the coverage that we've been doing um and uh yeah when the time
comes be be ready to act i guess is the one thing i'll say um okay so we will go doing and yeah, when the time comes, be ready to act, I guess is the one thing I'll say.
Okay, so we will go ahead and we'll call it.
Thanks everybody.
We will be back.
Oh, actually one last thing,
the trial will be back in session on Monday
in the Thurgood Marshall Courthouse.
I believe we're just gonna still be in room 110.
So just so everybody in this space knows, you can just
come out to the trial. You know, don't bring a device that you're not willing to hand over to
a marshal for the length of the day. But you can go and sit and you can watch. And, you know, it's
quite educational, quite interesting. And if you're like in Jersey, it's just over the bridge
downtown. So all right, we'll go ahead and we'll call it. Oh, I mean,
just see you tomorrow, David. Okay. All right. Thanks everybody.
We will be back at it again soon. Take care.
Good night.
Bye everyone. Thank you.
