On October 5, the U.S. Attorney for the Southern District of New York filed supplemental legal authority with the court (United States v. Storm, docket No. 305) on the venue question for two charges, citing the D.C. Circuit’s September 25 decision in United States v. Sterlingov. The appeals court held that Bitcoin Fog users’ transactions in Washington, D.C., could support venue for the related money-laundering conspiracy charge; local customers’ use of the service was also sufficient to support venue for a separate charge of operating an unlicensed money-transmitting business.
The DOJ argues on this basis that New York user Shakeeb Ahmed’s use of Tornado Cash in Manhattan—even if the funds remained in the pool for only about two days—helped expand the anonymity set and supported the concealment function of the mixing pool as a whole, giving a New York court venue over the relevant charge. Note that this is only the prosecution’s argument; Sterlingov was decided by the D.C. Circuit and is not directly binding on the Southern District of New York. The venue question is also distinct from whether Storm had criminal intent or should be held liable. In its October 7 report, Cointelegraph said the judge had not yet ruled on Storm’s post-trial motion to set aside the conviction.
My assessment: If a New York court adopts this reasoning, the legal risks facing privacy-protocol developers could extend to whether a service’s local use helps the system as a whole operate as a basis for venue. But this is not a ruling on the Ethereum protocol or ETH holders. Tornado Cash’s connection to $ETH is that its privacy-contract ecosystem is deployed on Ethereum; the proceedings in this individual case should not be interpreted as a change in ETH fundamentals.
In response, treat this as a regulatory-risk signal for privacy applications and developers, not as a basis for a directional view on ETH. Watch for Judge Failla’s ruling on the Rule 29 motion, whether the Second Circuit provides a more direct standard, and how the case proceeds. If the New York court distinguishes the local law and evidence in the D.C. case and rejects the prosecution’s analogy, the assessment that this decision expands venue risk in New York would not hold.
Market data for context only: As of 2026-10-07 08:02 UTC, ETHUSDT’s rolling 24-hour spot quote volume on Binance Spot was approximately $986.5 million, ranking second among tradable USDT spot pairs after excluding stablecoins and leveraged tokens. The 1-hour candlestick quoteAssetVolume for the two most recent complete 24-hour windows was approximately $985.6 million and $608.5 million, an increase of about 62.0%. This reflects trading activity; it does not mean the legal filing generated buying pressure, nor is it a price-direction signal.
Sources: U.S. District Court for the Southern District of New York, docket No. 305 (2026-10-05; docket filing preserved by CourtListener); D.C. Circuit, No. 24-3161 (2026-09-25); Cointelegraph (2026-10-07); Binance Spot REST API 24-hour spot market data and 1-hour candlesticks (queried 2026-10-07 08:02 UTC).
The DOJ argues on this basis that New York user Shakeeb Ahmed’s use of Tornado Cash in Manhattan—even if the funds remained in the pool for only about two days—helped expand the anonymity set and supported the concealment function of the mixing pool as a whole, giving a New York court venue over the relevant charge. Note that this is only the prosecution’s argument; Sterlingov was decided by the D.C. Circuit and is not directly binding on the Southern District of New York. The venue question is also distinct from whether Storm had criminal intent or should be held liable. In its October 7 report, Cointelegraph said the judge had not yet ruled on Storm’s post-trial motion to set aside the conviction.
My assessment: If a New York court adopts this reasoning, the legal risks facing privacy-protocol developers could extend to whether a service’s local use helps the system as a whole operate as a basis for venue. But this is not a ruling on the Ethereum protocol or ETH holders. Tornado Cash’s connection to $ETH is that its privacy-contract ecosystem is deployed on Ethereum; the proceedings in this individual case should not be interpreted as a change in ETH fundamentals.
In response, treat this as a regulatory-risk signal for privacy applications and developers, not as a basis for a directional view on ETH. Watch for Judge Failla’s ruling on the Rule 29 motion, whether the Second Circuit provides a more direct standard, and how the case proceeds. If the New York court distinguishes the local law and evidence in the D.C. case and rejects the prosecution’s analogy, the assessment that this decision expands venue risk in New York would not hold.
Market data for context only: As of 2026-10-07 08:02 UTC, ETHUSDT’s rolling 24-hour spot quote volume on Binance Spot was approximately $986.5 million, ranking second among tradable USDT spot pairs after excluding stablecoins and leveraged tokens. The 1-hour candlestick quoteAssetVolume for the two most recent complete 24-hour windows was approximately $985.6 million and $608.5 million, an increase of about 62.0%. This reflects trading activity; it does not mean the legal filing generated buying pressure, nor is it a price-direction signal.
Sources: U.S. District Court for the Southern District of New York, docket No. 305 (2026-10-05; docket filing preserved by CourtListener); D.C. Circuit, No. 24-3161 (2026-09-25); Cointelegraph (2026-10-07); Binance Spot REST API 24-hour spot market data and 1-hour candlesticks (queried 2026-10-07 08:02 UTC).