The court in ‘s-Hertogenbosch has found Alexey Pertsev, a 31-year-old developer of the crypto-mixing platform Tornado Cash and Russian citizen, guilty of laundering $1.2 billion in illegally acquired assets.

The three judges expect to hand down a verdict on Tuesday, with Pertsev’s lawyers having 14 days to appeal the ruling.

This judgment could have far-reaching consequences for the future of privacy within decentralized finance. Experts expect it will have a hindering effect on the development of open-source software that offers financial privacy tools to users.

In the March trial, prosecutors argued that Pertsev had not done enough to prevent criminal use of Tornado Cash. However, the defense argued that the open-source and automated nature of the smart contracts, which form the heart of the platform, meant that Pertsev could not be held liable for the actions of anonymous and independent users.

Tornado Cash, a decentralized protocol developed to hide transaction histories on the Ethereum blockchain, addresses the privacy concerns of publicly visible and immutable data. Nevertheless, prosecutors rejected the idea that technological arguments outweigh legal obligations to prevent criminal use and support of sanctioned entities such as North Korean cybercriminal groups.

Public prosecutor Martine Boerlage argued that, despite claims of a leaderless operation, Tornado Cash operated as a company. According to the US Office of Foreign Assets Control, the platform has been used to launder more than $7 billion from criminal hacks and thefts, with North Korea’s Lazarus Group as a primary abuser.

The crypto community has supported Pertsev with advocacy, petitions, and financial contributions to his lawsuit. Roman Storm, another Tornado Cash developer, is facing similar charges in the US, with his trial scheduled for September 23. Experts suggest Pertsev’s conviction may be an indication of what Storm can expect.


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