By Key Points
- DOJ accused of pressuring key witnesses to drop out
- Roman Storm’s defense shaken after witness pleads the Fifth
- Trump-era memos may weaken charges tied to crypto rules
- Jury appears confused by blockchain testimony, impacting case
The Tornado Cash Trial is shaping up to be one of the most important legal battles in crypto’s short history.
With the U.S. Department of Justice (DOJ) facing increasing criticism, the trial against Tornado Cash co-founder Roman Storm is no longer just about crypto regulation—it’s become a case study in controversial legal strategy.
This week brought a major twist. A key defense witness from blockchain analytics firm Chainalysis unexpectedly decided to plead the Fifth. This move came shortly after a phone call from federal prosecutors.
OK – now in US v. Roman Storm, defense case Day 3, Edman – & Melekan who opposed Tornado Cash sanctions. v. Agent George https://t.co/u9seDCg2lr Inner City Press put out book about the case, Crypto Tornado https://t.co/I5v9z8JIhg & will live tweet, thread below pic.twitter.com/KXFeJiWjUc
— Inner City Press (@innercitypress) July 28, 2025
While taking the Fifth is legal, the timing has sparked speculation that the DOJ is actively pressuring witnesses behind the scenes.
Storm’s legal team has long accused the DOJ of tactics meant to intimidate and silence supporters.
Just last week, reports surfaced that prosecutors considered charges against several Dragonfly Capital executives, just as the firm’s managing partner criticized the government for targeting potential Tornado Cash witnesses. The message was clear: speak up and face consequences.
chainalysis pleading the fifth while actively selling the very thing they are pleading the fifth about to the very govt who is actively prosecuting tornado cash right now lol lmao okie https://t.co/cK363qO3lX
— Tay 💖 (@tayvano_) July 28, 2025
But this strategy isn’t just raising eyebrows, it may be undermining the case. Legal experts point to an April memo from Deputy Attorney General Todd Blanche, appointed during the Trump administration, that softens the DOJ’s stance on crypto enforcement.
In the memo, Blanche instructed prosecutors not to charge unlicensed crypto operations unless it’s clear the defendant knew they were violating the law and did so intentionally.
That guidance casts doubt on the heart of the prosecution’s case, which is built on claims that Storm operated Tornado Cash without proper licensing. If Storm didn’t know about the licensing requirement, or if the requirement wasn’t clear, the charges could fall apart under the DOJ’s own new rules.
Dragonfly invested into PepperSec, Inc., the developers of Tornado Cash, in August of 2020. We made this investment because we believe in the importance of open-source privacy-preserving technology. Prior to our investment, we obtained an outside legal opinion that confirmed that…
— Haseeb ＞|＜ (@hosseeb) July 25, 2025
Without a solid legal foundation, the DOJ appears to be relying on emotional appeal and procedural pressure.
They’ve put alleged hack victims on the stand, but have yet to clearly connect Tornado Cash to specific crimes. Instead, the prosecution seems more focused on removing Storm’s key witnesses and keeping complex technical arguments out of the jury’s understanding.
If successful, it could also impact other privacy-focused or decentralized projects, including meme coins like Hulk Hogan token, which operate with minimal centralized control.
Jury Confused by Tech Details, Trial Outcome Still Unclear
Today, the defense pushed forward by calling two expert witnesses. One of them, Matthew Edman, co-founder of blockchain forensics firm NAXO, gave extensive testimony meant to help the jury understand how Tornado Cash functions.
According to courtroom observers, Edman’s testimony was technically accurate but perhaps too complex. Reporters noted that jurors appeared bored, confused, and even slouching, overwhelmed by the jargon-heavy presentation. Some whispered to each other, while others reportedly checked the clock.
Even noted crypto critic @molly0xFFF is now slamming the government’s handling of the @rstormsf Tornado Cash trial:
“I agree with Storm on the fact that writing code is not a crime. It’s not illegal to write privacy-preserving software.” pic.twitter.com/0AGrBIZ1r7
— Coinage (@coinage_media) July 28, 2025
Critics argue this confusion is no accident. Allegations have emerged that the DOJ carefully shaped the jury selection process to exclude anyone with knowledge of blockchain or digital finance. While legal, this strategy can severely disadvantage a defense that relies on explaining how complex tech tools actually work.
As the trial enters another crucial week, both sides are adapting. The prosecution continues to rely on emotional arguments and regulatory vagueness.
Judge Failla: Defense, call your next witness.
It’s expert Matthew Edman of NAXO.
Storm’s lawyer Axel: Have you testified in the SDNY?
Edman: Yes. And I did a written submission for the US prosecutors in the Northern District of California.
[Long intro to jury]— Inner City Press (@innercitypress) July 28, 2025
The defense is now faced with the difficult task of simplifying its message, especially without some of its best expert voices, who now fear retaliation.
The crypto community is watching closely. Many believe that the outcome of this case could set a dangerous precedent for how privacy tools and open-source software are treated under U.S. law.
If Storm is convicted based on vague regulations and misunderstood technology, developers and users of other decentralized tools could be next.
This could shake confidence in projects even with strong reputations, much like the market volatility seen when Ripple’s co-founder dumped $140M in XRP.
IMO, Dr. Edman has been a particularly strong witness, but, unfortunately, the jury looked a bit bored and maybe even overwhelmed as he walked the court through a lot of technical jargon and how it applies to the case.
Hopefully, the jury grasped enough of what he had to say, as…
— Frank Corva (@frankcorva) July 28, 2025
What This Means for Crypto and Open-Source Developers
The Tornado Cash Trial is more than just a high-stakes legal fight—it’s a moment of truth for the entire crypto space. Privacy, decentralization, and open-source code are at the core of blockchain innovation. But this trial may change how those concepts are treated by law.
Developers across the Web3 ecosystem are increasingly nervous. Tornado Cash was a tool, not a service, it was decentralized, and its code was publicly available.
Yep, jury has a serious case of the Mondays today. Many slouched in their seats, one with her head in her hands rubbing her temples, another mindlessly picking her split ends, a few others frequently staring up at the clock on the back wall.
To be fair, it’s 12 non–tech-savvy… https://t.co/Qrmmuh9dXD
— Eleanor Terrett (@EleanorTerrett) July 28, 2025
Storm didn’t run a business in the traditional sense. Yet, the DOJ argues that simply creating or contributing to privacy tools could make someone criminally liable, even without direct involvement in illegal activity.
This blurs the line between tool creation and criminal facilitation. If the DOJ’s view holds, open-source developers could be held responsible for how others use their code, especially in cases where it’s used for anonymity or financial privacy.
It’s a shortcoming of the system in some ways, yes.
The bigger issue is that they aren’t randomly selected. The prosecution did their damndest to keep people who understand the tech off the jury.
— Frank Corva (@frankcorva) July 28, 2025
That’s a chilling thought for a community that thrives on experimentation and innovation. Already, developers have begun to question whether contributing to privacy projects or decentralized platforms could put them at risk. Some have even moved operations offshore or paused projects entirely.
Meanwhile, regulators are sending mixed signals. While one part of the government talks about encouraging innovation, another is aggressively pursuing crypto cases using unclear rules and last-minute legal shifts. The lack of clarity creates fear, and fear stifles innovation.
Some projects, like Vine token, have seen massive gains amid speculation and hype—but they operate in a regulatory gray area. Others, such as PancakeSwap’s CAKE, are continuing to evolve while navigating increased scrutiny.
Even Ethereum, celebrated for its 10-year uptime, could face challenges if the legal environment around privacy and decentralization continues to shift unpredictably.
This case, then, is a crossroads. It will likely influence how courts and lawmakers view everything from mixers and zero-knowledge tech to DeFi protocols and DAO governance. And while Roman Storm sits in court, the entire crypto world is sitting on edge.
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