Sometimes, in the midst of the same and remuneration scandals for access, it can be difficult to remember that the cryptography industry has been built on the principles of privacy and autonomy. The elusive Satoshi Nakamoto published the Bitcoin White Paper following the 2008 financial crisis, after all. Even if Wall Street swallows the whole blockchain technology, the nucleus is always a spirit of disintermediation.
I joined Fortune In August 2022, the same month that the American Treasury Department sanctioned the Tornado in cash, a virtual currency mixer which allowed users to grasp their (very traceable) assets of cryptocurrency and to receive an anonymous exit. The software, predictablely, has become a favorite of terrorist organizations and hacking groups affiliated to North Korea, but it also embodied the Cypherpunk ideology which gave birth to the cryptographic sector.
The action of the OFAC has created new questions, such as a piece of code, rather than a person or an organization, can be sanctioned. He also attracted the anger of the defenders of privacy, who argued that Internet users should have the right to own and send digital species without government interference, just as offline people can with physical money (to a certain extent). These, more than crypto bros trying to raise the price of their tokens through waterfalls linked to sex toys, are the fascinating dilemmas raised by blockchain technology, and what distinguishes it from other forms of financial technology. (And as much as I hoped that subjects like Tornado Cash would dominate my coverage, the Sam Bankman FTX Empire collapsed two months later.)
A year after the sanctions, the Ministry of Justice brought charges against the creators of Tornado Cash, with one, novel Storm, arrested in the United States. It was a delicate case for the cryptography industry. The DOJ’s indictment clearly indicated that the founders knew the main utility of their software was to help the money launders, including the Lazare group in North Korea, and they won millions of dollars on the platform thanks to their own owner token. In a recurring segment that I like to call “Take notes on a criminal plot”, admitted a founder to a text they had to give up control of the software to give the impression that they were not the owners. As a former MJ prosecutor told me at the time, “these were quite blatant facts.”
But many powerful voices in the cryptography industry, including the paradigm of the company giant, have always thrown their weight behind Storm, arguing that the case of government eroded the idea of software preserving privacy and was in direct contradiction with the previous guidelines issued by the Division of Financial Crimes of the Treasury Department.
The initial trial of Storm, which was held in the same courthouse which welcomed Bankman Fried, ended last week. Although he avoided two of the most serious accusations, the jury has always found him guilty, linked to the exploitation of a business transmission company without license. Its defenders promised to fight it, arguing that the decision establishes a precedent dangerous for the future of confidentiality software.
The most interesting question is why the case was authorized to continue under the Trump administration, which largely adopted the cryptography sector – or at least the elements more linked to financial gains. The Securities and Exchange Commission abandoned business against Coinbase and Justin Sun, and the Doj published a memo announcing the end of “pursuit regulations” against the blockchain industry. They even abandoned one of the smallest accusations against Storm on recording. But the main charge – that a developer should be responsible for non -guardian software – was authorized to continue.
The chorus since Trump returned to the post is that, thanks to the new lax regulatory approach, the crypto application is outside the table. Unfortunately for Storm, it seems that it is limited to the same.
Leo Schwartz
X: @Leomschwartz
E-mail: leo.schwartz@fortune.com
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Business affairs
– BinsentryA agricultural technology company fed by the AI of Kitchener, Ontario, has raised $ 50 million in C -series financing. Lead Edge Capital led the Tour.
– CasapAn Automation Technology Developer based in San Francisco for litigation and fraud cases, raised 25 million dollars in series A series. Emergence Capital led the Tour and was joined by Speed Adventure Partners,, Primary Adventure Partners,, Soviand others
Investment capital
– Datasitesupported by Trim Partnersacquired SourcescrubA supplier based in San Francisco of data and workflows of the agreement. The financial conditions have not been disclosed.
– Hg Knowledgesupported by River Capital Investorsacquired MadkuduA provider of GTM solutions based in Mountain View, California. The financial conditions have not been disclosed.
– Jenmara portfolio company Hawk Partnersacquired Weber Mining & Tunneling SASA developer of Rouhling resins and foams in France for mining processes. The financial conditions have not been disclosed.
– Schneider Geospatiala portfolio company Align Capital Partnersacquired Complete Circle TechnologiesA license and license software based in Boston, Mass. The financial conditions have not been disclosed.
Outings
– Sentinel agreed to acquire Fast SecurityA cybersecurity platform fed by AI based in New York, Leap Capital.
OTHER
– 10x Genomic agreed to acquire Ladder BiosciencesA unique analysis company based in San Diego, California. The financial conditions have not been disclosed.
