A high-ranking official from the US Department of Justice addressed a crypto audience in Wyoming, acknowledging that recent convictions of software developers were on their minds. The official, Matthew Galeotti, stated that the department does not aim to target digital asset software developers who lack intentions of money laundering, receiving applause from the crowd.
Galeotti emphasized that the department will not utilize federal criminal laws to establish a new regulatory framework for the digital asset industry, nor will it use indictments as a means to create laws. He added that merely creating code without malicious intent is not considered a crime. These statements come after recent courtroom developments, including the conviction of Tornado Cash developer Roman Storm for operating an unlawful money transmitting business.
Galeotti directly addressed concerns regarding the specific criminal code under which Storm and other developers were convicted, stating that the DOJ would only apply this code if prosecutors have evidence that a defendant was aware of the specific legal requirements and willfully violated them. He also noted that new charges under this code would not be pursued in cases where software is truly decentralized and solely automates peer-to-peer transactions, without a third party having custody and control over user assets.
The DOJ's stance on crypto cases was outlined in an April memo by Deputy Attorney General Todd Blanche, which emphasized the need for a careful approach to crypto cases following the previous administration's creation of an uncertain regulatory environment. Despite this memo, the Southern District of New York proceeded with cases against Storm and other developers. Galeotti reiterated that developers of neutral tools with no criminal intent should not be held responsible for the misuse of their tools by third parties.
Instead, the third party should be prosecuted for any violations of criminal law. The protection of crypto software developers has been a central point of negotiation between the industry and lawmakers in Washington, with current legislation including protections for such developers. Amanda Tuminelli, executive director of the DeFi Education Fund, welcomed the DOJ's acknowledgement, stating that it affirms the industry's long-standing advocacy and marks a moment of progress, while also acknowledging that more work is needed to permanently change the law.