Tornado Cash dev Alexey Pertsev’s court verdict is today: Here’s what we know

Tornado Cash developer Alexey Pertsev is facing a lengthy prison sentence should a panel of judges in the Netherlands find him guilty of money laundering charges.

That court decision is today, May 14 and comes amid Dutch prosecutors’ recommendation that Pertsev be slapped with a 64-month prison sentence.

Ahead of the sentencing, here’s what we know about this case and what its conclusion could mean for the crypto space.

Tornado Cash dev’s arrest in the Netherlands

Tornado Cash is a blockchain protocol that allows users to mix their cryptocurrency coins on-chain.

The crypto mixing service on Ethereum launched in August 2019. Its developers are Alexey Pertsev, Roman Storm and Roman Semenov.

Shortly after its launch, the US Office of Foreign Assets Control (OFAC) sanctioned the North Korea-linked hackers, the Lazarus Group. The sanctions also pointed to the use of crypto tools such as mixers to perpetuate money laundering.

In September 2019, hackers siphoned over $275 million from KuCoin. In March 2022, a hack saw $625 million drained from the Ronin Bridge. These and other multi-million dollar crypto hacks have been linked to Lazarus Group and laundering via Tornado Cash.

OFAC sanctioned Tornado Cash on August 8, 2022. Shortly after, on August 10, Dutch police arrested Alexey Pertsev in Amsterdam, news that saw TORN coin plummet.

Authorities linked the arrest to the Tornado Cash mixer and its use in alleged money laundering.

US sanctions Tornado Cash, arrests founder

The crypto community widely condemned Pertsev’s arrest, including US whistleblower Edward Snowden.

But a year after Dutch authorities arrested Pertsev in August 2022, the US Department of Justice charged Tornado Cash founders Roman Storm and Roman Semenov with money laundering and sanctions violation.

The charges related to allegations that the two created, promoted and facilitated the laundering of millions of dollars for Lazarus Group and others via Tornado Cash. They put the value of laundered funds at over $1 billion.

Storm was arrested in August 2023 and is awaiting trial, scheduled for September 2024 in the US.

What could the outcome of the Pertsev case portend?

A Dutch court in ‘s-Hertogenbosch heard the case against 31-year old Pertsev in March this year. Prosecutors argued that the code (for the Tornado Cash mixer) that Pertsev wrote is what helped criminals with their money laundering efforts.

The allegation is that the developer helped launder $1.2 billion through the Tornado Cash crypto mixer.

As part of their quest for a guilty verdict, the prosecution argued that the case is not about the software or code.

Rather than the smart contracts, it’s down to the criminal behaviour of the Tornado Cash developer. They want Pertsev found guilty and jailed for 64 months

If the panel of judges agree with the Dutch prosecutors, the effect on what next for crypto software developers and other open source projects could be profound. It could push devs out of the ecosystem and curtail innovation across the market.

An acquittal on the other hand would send the overall message that developers of open source technology are not liable for its usage.

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