The U.S. Department of Justice has found Tornado Cash co-founder Roman Storm guilty of operating an unlicensed money transmitting business, which poses a significant impact on DeFi developers and regulatory frameworks. (Background: The U.S. Department of Justice plans to prosecute Tornado Cash investor Dragonfly Capital) (Additional context: Tornado Cash co-founder Roman Storm reiterated that 'open-source software is not guilty,' with Vitalik supporting: on-chain privacy is crucial) On August 6, Eastern Time, a Manhattan jury ruled that Tornado Cash co-founder Roman Storm was guilty of 'conspiracy to operate an unlicensed money transmitting business,' facing a maximum sentence of five years. This marks the first time the U.S. has included decentralized protocol developers within the same compliance framework as traditional money transmitters, drawing significant attention from the global crypto market. Details of the ruling and legal focus show that the jury could not reach a consensus on the more serious charges of 'conspiracy to commit money laundering' and 'conspiracy to violate sanctions,' with legal expert Samson Enzer pointing out that this reflects the difficulty for prosecutors to prove that developers have direct control over the protocol or the subjective intent to assist in criminal activity. Nevertheless, Tornado Cash's provision of anonymous transaction services was viewed by prosecutors as facilitating money laundering exceeding $1 billion, including funds from the North Korean hacking organization Lazarus Group. Ultimately, the 'unlicensed money transmitting' charge was upheld, indicating that the government can intervene in decentralized applications through existing money transfer regulations, and all future programs providing mixing or privacy features may be required to comply with similar standards. Community reactions and regulatory calls emerged swiftly after the ruling was announced. The DeFi Education Fund criticized the outcome as 'disappointing,' believing the case may create a chilling effect on developers; Coin Center and the Blockchain Association also called on the government to present clear regulations rather than relying on 'litigation-based regulation.' According to crypto journalist Eleanor Terrett's post, he mentioned that Storm plans to contest this charge and appeal, calling it nonsense. Just encountered @rstormsf outside the courtroom; I asked him how he felt. He spoke calmly but with a noticeable smile, saying: 'This is a big win. That '1960 charge' is nonsense, and we will fight it all the way. You know how President Trump said 'fight, fight, fight'? We will do the same.' He expressed relief at not being detained and mentioned his 5-year-old daughter, saying this is one reason he insists on contesting the guilty charge. He said he would return to Seattle tomorrow. NEW: Just caught @rstormsf outside the courtroom. I asked how he was feeling. In a quiet voice, but with a noticeable smile, he told me: 'It’s a big win. The ‘1960’ charge is bullshit and we’re going to fight it all the way. You know how President Trump said ‘fight, fight,… https://t.co/ufgD40xWEn — Eleanor Terrett (@EleanorTerrett) August 6, 2025 Some observers have drawn parallels to President Trump's earlier pardon of Silk Road operator Ross Ulbricht, but it remains uncertain whether Storm might receive similar treatment. Industry prospects and potential ripple effects: The White House recently reported that current anti-money laundering regulations need modernization to respond to the challenges posed by decentralized finance. With the resolution of the Storm case, global regulatory bodies will undoubtedly observe U.S. practices, potentially leading to tighter regulations. For developers and investors, the legal costs and risks of operating privacy protocols in the U.S. are rapidly increasing; project teams may need to strengthen compliance departments, implement geographic restrictions or KYC processes, or even shift to jurisdictions with looser regulations. The ruling against Roman Storm brings decentralized privacy technology into a new scrutiny phase. On one side are the demands for innovation and privacy, while on the other are anti-money laundering and national security considerations; the balance remains undecided. However, it is certain that the crypto industry has officially entered an era of 'compliance first,' where every product design and capital deployment will recalibrate risks within legal boundaries. Related reports: From privacy advocate to 'money laundering' defendant, Tornado Cash co-founder Roman Storm faces a fate decision. Is the Tornado Cash mixer controversy not over? Coinbase angrily criticizes: The U.S. Treasury's ambiguous handling evades a final ruling. 'The U.S. Department of Justice finds Tornado Cash founder Roman Storm guilty of 'unlicensed money transmitting,' with the crypto community rallying in support.' This article was first published on BlockTempo (the most influential blockchain news media).