Paradigm’s attorneys argue the U.S. government’s legal position misinterprets both FinCEN guidance and established case law. According to their brief, merely publishing open-source code should not equate to operating an unlicensed money transmitter business. They stress that, under U.S. law, developers cannot be held criminally liable for money laundering unless they knowingly facilitate the movement of criminal proceeds. Paradigm calls on the jury to acquit Storm unless direct intent can be proven.

The case against Roman Storm centers on his role in developing Tornado Cash, a decentralized cryptocurrency mixer. The U.S. Department of Justice alleges he conspired to launder funds and violated international sanctions, despite having dropped some initial charges earlier this year. Tornado Cash itself was sanctioned in 2022, only to see those restrictions lifted in January 2025. However, U.S. prosecutors have maintained their pursuit of criminal liability for Storm.

Paradigm’s intervention follows a $1.25 million legal defense donation by its co-founder Matt Huang in January 2025. This aligns with support from the Ethereum Foundation, which made an identical contribution for the legal defense of Alexey Pertsev, another Tornado Cash co-founder.

In a public statement on X (formerly Twitter), Roman Storm described Tornado Cash as an essential tool for DeFi freedoms—permissionless, trustless, non-custodial, immutable, and unstoppable. He emphasized the far-reaching implications of his trial: “If I lose, DeFi dies with me,” warning that a negative verdict could effectively criminalize open-source innovation and destroy the foundational principles of decentralized finance.

Regulatory Precedent and Industry Backlash

Paradigm’s filing characterizes the prosecution as a watershed moment for the industry, warning of a chilling effect on U.S. crypto innovation if open-source publishing is conflated with illegal activity. The case’s outcome is expected to set a critical precedent not just for blockchain developers, but for the broader software community engaged in permissionless protocols.