By Key Points
- IRS agent traced $8M moved by Roman Storm via Binance
- $2.6M allegedly sent to Tornado Cash co-founders
- Chat logs suggest offshore shell setups and crypto real estate buys
- Defense argues smart contracts were immutable after May 2020
Tornado Cash co-founder Roman Storm is under intense scrutiny as the trial unfolds, with new evidence presented by federal prosecutors painting a potentially damning picture.
IRS Criminal Investigation Special Agent Stephan George testified that he traced over $533,000 in USDT from a Binance account linked to Storm. This transaction reportedly took place on August 9, 2022, and the funds were split across three separate cryptocurrency wallet addresses.
UPDATE in US v. STORM: IRS blockchain tracer Stephan George today testified that he traced 9.7 ETH derived from the defrauding of Hanfeng Lin to Tornado Cash using Chainalysis and TRM Labs tools.
Also, prosecutors indulge in some light heckling of @davidzmorris. pic.twitter.com/0MmrTWdk0a
— The Rage (@theragetech) July 23, 2025
The most eye-catching revelation? Chat messages allegedly show Storm admitted to overloading $8 million through Binance and distributing $2.6 million each to fellow co-founders Roman Semenov and Alexey Pertsev.
“I overloaded 8 million yesterday.”
“I sent you guys 2.6 million each.”
That wasn’t all. In a separate conversation, Storm is accused of instructing someone to create offshore entities and buy real estate using crypto funds. Prosecutors also cited a message from Semenov saying:
“I will send some TORN later, to avoid getting busted.”
AUSA: This document, who was in the conversation?
Agent George: The three founders: Pertsev, Storm and Semenov. Storm wrote, Basically I overloaded 8 million yesterday.
AUSA: And this?
George: Storm wrote, I sent you guys 2.6 million each.— Inner City Press (@innercitypress) July 23, 2025
Ms. Lin
The government argues that these messages indicate Storm’s intent to obscure financial trails and extract personal profit from Tornado Cash operations, challenging claims of decentralized, hands-off protocol governance.
This comes amid heightened scrutiny of crypto activity, similar to how Crypto Beast was exposed for a dump scam involving insider manipulation. The Tornado Cash trial could have a similar level of market impact — but with far deeper legal implications.
IRS Special Agent George’s testimony as it pertained to Ms. Lin’s stolen showed that a percentage of the stolen funds may have actually gone through Tornado Cash. pic.twitter.com/0qqf3DpW0f
— Frank Corva (@frankcorva) July 23, 2025
Immutability and UI Use Become Central to the Defense
Storm’s legal team isn’t backing down. During cross-examination, the defense highlighted a key point in Tornado Cash’s architecture — immutability.
Since May 2020, Tornado Cash’s smart contracts have been immutable. This means no single person — not even its founders — could alter how the mixer’s core code functioned.
This detail is crucial to the defense’s argument: Storm may have created the tool, but he couldn’t control how it was used post-deployment.
Adding weight to this stance, the defense team pointed out that Tornado Cash’s front-end UI didn’t execute crypto transactions itself.
Instead, all transactions flowed directly through Ethereum smart contracts. The UI merely provided a user-friendly way to interact with those contracts.
But prosecutors pushed back with their data.
AnChain.AI’s Philip Werlau told the court that 96.2% of Tornado Cash users accessed the protocol via its UI — suggesting centralized influence might still have played a role, despite the immutable contracts.
Another key point raised: North Korea’s Lazarus Group reportedly shifted to using command-line interaction only after Tornado Cash was sanctioned — a sign, according to prosecutors, of users adapting to avoid surveillance.
This debate over control vs. decentralization is not new. ARK Invest’s Coinbase sell-off showed how centralized decisions still deeply affect supposedly decentralized ecosystems. The Tornado Cash case brings this issue into the courtroom.
Meanwhile, discussions around crypto tools like mixers and privacy protocols often intersect with concerns around regulation and misuse. The increasing involvement of public companies in Ethereum may push regulators to draw harder lines — especially when high-profile trials like Storm’s are in the spotlight.
What’s Next for Roman Storm?
While the defense leans on Tornado Cash’s decentralized and immutable nature, the government is building a narrative of covert communication, offshore maneuvering, and active financial involvement — well after the protocol’s deployment.
Judge Failla also instructed the jury not to consider an email from a witness named Ms. Lin as factual evidence, after it was introduced by the prosecution.
This first witness in Roman’s trial immediately caught my attention bc the victim was a classic Pig Butchering case.
The only issue is….uh…..those scammers don’t use Tornado Cash? And they never have?
So, like, wtf? https://t.co/27MlcXvc0z
— Tay 💖 (@tayvano_) July 18, 2025
This raised eyebrows, given previous murmurs from the defense about a possible mistrial — though no motion has yet been filed.
The prosecution is expected to rest its case tomorrow morning. Still pending is a separate hearing on Chainalysis expert testimony, which could further complicate matters for Storm.
Once the prosecution wraps, Storm’s defense will take center stage — doubling down on the argument that immutability shields Storm from liability for how others used Tornado Cash.
As the trial enters its next phase, the crypto world watches closely. The outcome could set a precedent for how U.S. courts view open-source developers and the protocols they build.
This comes just as headlines around El Salvador’s controversial Bitcoin claims and Ethereum’s burning NFT torch continue to reshape the narrative around crypto accountability and decentralization.
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