Tornado Cash and the Money Transmitter Question

Prepared by the editorial team. Updated August 31, 2026.

Tornado Cash produced a criminal trial in New York whose outcome is regularly summarized in one sentence, and almost every version of that sentence is wrong in some respect. A jury reached a verdict on one count and could not agree on two others, leaving the case unfinished. This article explains the charge that produced a conviction, what remains open, and how to read the case accurately.

What is an unlicensed money transmitting business under US law?

Federal law makes it an offense to knowingly conduct, control or own a money transmitting business that lacks a required state license or federal registration. The provision targets the operation of a money-moving business without regulatory registration. It does not require proof that the funds moved were criminal proceeds, which distinguishes it sharply from money laundering.

The concept originates in a framework built for identifiable businesses that accept funds from customers and deliver them elsewhere: remittance companies, currency exchanges, informal value transfer networks. Registration exists so such businesses fall inside anti-money-laundering supervision, keep records and report suspicious activity. The theory is preventive rather than punitive, catching the channel before it is misused.

Applying this to open-source software raises the question the crypto industry has watched most closely. If a developer writes and publishes code that other people use to move their own funds, without ever holding those funds, is the developer conducting a money transmitting business? The government’s answer emphasized how the overall service was built, promoted and maintained. The defense answered that publishing non-custodial software is not operating a business, and the disagreement is what the case turned on.

What did the jury decide in August 2025?

In August 2025 the jury convicted Roman Storm on one count, conspiracy to operate an unlicensed money transmitting business, and could not reach a verdict on the two remaining counts covering money laundering conspiracy and sanctions evasion conspiracy. The result was therefore partial, and the case did not end with it.

A split verdict of this shape carries information. Jurors were persuaded beyond reasonable doubt on the registration-related theory while remaining divided on the charges requiring proof about the character of the funds and the defendant’s intent regarding them. The unlicensed transmission count asks a narrower question than laundering does, and it is common for the narrower count to be the one that resolves.

The conviction has not concluded that count either. Storm filed a motion for acquittal in September 2025 asking the court to set aside the verdict as unsupported. Oral argument was heard in April 2026 and, as of this writing, the motion remains undecided by Judge Katherine Polk Failla in the Southern District of New York. Descriptions of the case as finished are premature on this point.

Why did the jury deadlock on the other two counts?

Jury deliberations are confidential, so no one can state the reason with authority. What can be said is structural: both deadlocked counts required proof about the money itself and about the defendant’s state of mind toward it, which is a materially heavier burden than the registration question that produced a conviction.

Money laundering conspiracy generally requires showing an agreement to conduct transactions involving proceeds of unlawful activity, with knowledge of that character. Sanctions evasion under the relevant statutes requires a willful violation of a specific prohibition. Each demands evidence connecting a defendant’s knowledge and intent to particular funds or a particular restriction, and each offers more places for reasonable doubt to take hold.

There is an important procedural consequence. A hung count is not an acquittal, because no verdict was returned in either direction. Double jeopardy therefore does not bar a second attempt, and prosecutors may retry those counts before a new jury. That is the path the government has chosen, which is why a second trial exists at all.

What is scheduled to happen at the April 2027 retrial?

The retrial is scheduled for April 26, 2027 before Judge Katherine Polk Failla at the Thurgood Marshall Courthouse in the Southern District of New York, with a final pretrial conference set for April 20, 2027. It covers the two counts on which the first jury deadlocked, not the count already decided.

A retrial is a fresh proceeding rather than a review of the first. A new jury is selected, evidence is presented again, and the earlier deadlock has no weight before them. Both sides usually adjust: the government reconsiders how it framed the elements that failed to persuade, and the defense refines arguments that worked. Reporting on a retrial as an appeal of the first trial confuses two different mechanisms.

The stakes on these counts are substantially higher than on the resolved one. Reporting on the scheduling indicates that a conviction on both retrial charges could carry a statutory maximum of up to 40 years. Statutory maximums are ceilings rather than expected outcomes, and actual sentences in federal court are driven by guidelines calculations and judicial discretion, but the gap between the counts explains why the second trial matters more than the first.

How can you follow a federal criminal case through primary sources?

You identify the docket number and district, read the charging document, separate filings from rulings, check the current scheduling order, and note the date along with what remains undecided. This is a research procedure for reading court records and does not concern the operation of any protocol.

Step 1: Find the docket number and district

Establish the exact case caption, docket number and district before anything else, because these identifiers are what let you locate the authoritative record rather than a description of it written by someone else. Similar names and parallel proceedings make precise identifiers necessary rather than optional.

Step 2: Read the charging document

Read the indictment or superseding indictment to see exactly which statutes are charged and in how many counts, since coverage frequently compresses several distinct charges into a single informal label. The count structure is what later makes a split verdict intelligible.

Step 3: Distinguish filings from rulings

Separate what a party has argued in a motion from what the court has actually decided in an order, because a persuasive brief is an assertion by one side and carries no legal effect until a judge rules on it. A great deal of confused commentary comes from treating a filing as an outcome.

Step 4: Check the current scheduling order

Look at the most recent scheduling order rather than an older report, because trial dates, conferences and deadlines in complex cases are adjourned frequently and previously accurate dates go stale. This case has itself been rescheduled more than once.

Step 5: Note the date and the unresolved questions

Record when you checked and which matters remain undecided, because an accurate summary of a live case describes its posture at a moment in time rather than presenting it as a finished story. Naming the open questions is what keeps a summary honest.

Case status at a glance

The proceedings involve several distinct threads that are frequently merged in summaries. The table sets out each and its position as of this writing, and readers should verify against the current docket because a live case changes.

Thread	Position as of this writing
Unlicensed money transmitting conspiracy	Jury convicted in August 2025; acquittal motion argued and undecided
Money laundering conspiracy	Jury deadlocked; set for retrial
Sanctions evasion conspiracy	Jury deadlocked; set for retrial
Retrial date	April 26, 2027, with a final pretrial conference on April 20, 2027
OFAC designation of the protocol	Removed from the SDN list in March 2025, separate from this case
Dutch proceedings against Alexey Pertsev	Convicted May 2024, conditionally released pending appeal, separate legal system

Two of these threads are administrative and four are judicial, and they move independently. A change in one is not evidence of a change in another.

Frequently asked questions

Is a hung count the same as an acquittal?

No. A hung count means the jury could not reach the required unanimity, so no verdict was returned either way. Double jeopardy does not attach, which is why the government may retry those counts before a new jury.

Why is the retrial scheduled so far after the first trial?

Complex federal cases routinely take years between proceedings because of pending motions, court calendars and the volume of technical evidence. In this case a motion for acquittal filed in September 2025 remained undecided after argument, and the schedule was adjourned to April 2027.

Does this case set a binding precedent for other developers?

A jury verdict resolves one defendant’s case on its own facts and does not create binding precedent in the way an appellate opinion does. Written rulings on legal questions in the case can still be influential, and other prosecutors and defense teams follow them closely.

How does the Dutch case against Alexey Pertsev relate to this one?

They are separate prosecutions in separate legal systems with different statutes and different defendants. Pertsev was convicted in the Netherlands in May 2024 and later conditionally released while pursuing an appeal, and neither case controls the outcome of the other.