One hand is easing up while the other tightens its grip. Taken together, these two developments reveal the real stance the U.S. government is taking toward crypto privacy tools this week..
⚖️ 消息第一时间
On Monday, the U.S. Department of Justice cited a September 25 ruling by the D.C. Circuit Court of Appeals in the Bitcoin Fog mixer case in a supplemental filing, using it to oppose Tornado Cash developer Roman Storm’s motion for acquittal.. At almost the same time, the Treasury Department announced that it was withdrawing its own proposed rules for regulating crypto mixers.. In the same week, one government agency is ramping up pressure while another is backing down..
Most people see a legal proceeding that has dragged on for more than a year, with no clear winner yet.. What’s really worth watching is that two different attitudes toward privacy tools are coexisting within the government—and that will directly determine how the market prices privacy-focused assets..
The prosecution’s argument hinges on the question of jurisdiction.. The ruling says that Bitcoin Fog had customers in Washington and that undercover agents conducted transactions there, which was enough to support a conviction.. The DOJ has applied the same logic in Manhattan, arguing that someone’s use of Tornado Cash in their own apartment is enough to bring charges in the Southern District of New York.. Storm’s lawyers have long argued that these isolated transactions did not advance the alleged conspiracy..
This is no longer a technical dispute; it’s a disagreement over whether the tools themselves are a problem.. If the mere fact that someone used a tool is enough to establish jurisdiction, then developers of any code running on neutral infrastructure could automatically be held responsible for their users’ actions.. By withdrawing its proposed rule, the Treasury Department has effectively acknowledged that a blanket approach to regulating mixers won’t work..
The price of privacy-focused assets has been moving with the push and pull between these two positions.. The tougher the stance, the greater the discount on privacy assets and tools.. The softer the stance, the more capital returns to test the waters.. What’s really being traded has never been the outcome of the case, but whether the government is willing to recognize privacy as a legitimate need..
The broader story is that the U.S. is now pursuing two paths at once.. One treats developers as operators and holds them accountable; the other recognizes privacy as a legitimate need.. These two paths cannot coexist indefinitely. Sooner or later, they will have to converge on a single position..
The next thing to watch is whether the retrial scheduled for April 26 next year can be avoided.. If the pending charges are dropped first, that would suggest the principle of tool neutrality has prevailed.. If the case moves forward, it would mean the government plans to gradually push the boundaries through one case after another.. The ruling in any single case isn’t really the point; what matters is the default answer it will leave for everyone who writes privacy code in the future..
⚖️ 消息第一时间
On Monday, the U.S. Department of Justice cited a September 25 ruling by the D.C. Circuit Court of Appeals in the Bitcoin Fog mixer case in a supplemental filing, using it to oppose Tornado Cash developer Roman Storm’s motion for acquittal.. At almost the same time, the Treasury Department announced that it was withdrawing its own proposed rules for regulating crypto mixers.. In the same week, one government agency is ramping up pressure while another is backing down..
Most people see a legal proceeding that has dragged on for more than a year, with no clear winner yet.. What’s really worth watching is that two different attitudes toward privacy tools are coexisting within the government—and that will directly determine how the market prices privacy-focused assets..
The prosecution’s argument hinges on the question of jurisdiction.. The ruling says that Bitcoin Fog had customers in Washington and that undercover agents conducted transactions there, which was enough to support a conviction.. The DOJ has applied the same logic in Manhattan, arguing that someone’s use of Tornado Cash in their own apartment is enough to bring charges in the Southern District of New York.. Storm’s lawyers have long argued that these isolated transactions did not advance the alleged conspiracy..
This is no longer a technical dispute; it’s a disagreement over whether the tools themselves are a problem.. If the mere fact that someone used a tool is enough to establish jurisdiction, then developers of any code running on neutral infrastructure could automatically be held responsible for their users’ actions.. By withdrawing its proposed rule, the Treasury Department has effectively acknowledged that a blanket approach to regulating mixers won’t work..
The price of privacy-focused assets has been moving with the push and pull between these two positions.. The tougher the stance, the greater the discount on privacy assets and tools.. The softer the stance, the more capital returns to test the waters.. What’s really being traded has never been the outcome of the case, but whether the government is willing to recognize privacy as a legitimate need..
The broader story is that the U.S. is now pursuing two paths at once.. One treats developers as operators and holds them accountable; the other recognizes privacy as a legitimate need.. These two paths cannot coexist indefinitely. Sooner or later, they will have to converge on a single position..
The next thing to watch is whether the retrial scheduled for April 26 next year can be avoided.. If the pending charges are dropped first, that would suggest the principle of tool neutrality has prevailed.. If the case moves forward, it would mean the government plans to gradually push the boundaries through one case after another.. The ruling in any single case isn’t really the point; what matters is the default answer it will leave for everyone who writes privacy code in the future..
