Alexey Pertsev, the developer of Tornado Cash, a cryptocurrency mixing protocol, has been denied bail by a Dutch court despite his defense team’s appeal. Pertsev, sentenced to over five years in prison on money laundering charges, will remain in detention while his lawyers prepare for the subsequent appeal. Pertsev’s legal team intended for him to prepare for his appeal trial under more facilitative conditions, including internet access and legal resources. The court, however, dismissed these requests.
The court’s decision has sparked outcry among crypto veterans, with organizations like JusticeDAO vociferously criticizing the decision and rallying funds for Pertsev’s legal defense. Supporters contend that Tornado Cash enhances Ethereum blockchain privacy, while prosecutors claim the developers failed to hinder illicit entities from washing stolen funds via their platform.
Pertsev was taken into custody in the Netherlands in August 2022 after the U.S. government blacklisted Tornado Cash, accusing it of being an essential tool for the North Korean hacking group Lazarus. This group has been associated with significant crypto thefts, particularly the $625 million hack of Axie Infinity’s Ronin Network. The result of his case could potentially affect the pending trials of other Tornado Cash developers, Roman Storm and Roman Semenov.
Lastly, in terms of U.S. legislation, the US Blockchain Integrity Act has been put forth this year by democratic representatives seeking to curb crypto mixers. This legislation aims to block the flow of illegal funds and foster transparency by prohibiting financial institutions and registered money services from handling funds processed through a mixer.