Arbitrum DAO Removes Proposal To Fund Tornado Cash Legal Defense

The Arbitrum DAO has removed a proposal that sought to fund the legal defense of Tornado Cash developers Roman Storm and Alexey Pertsev. 

According to the Arbitrum DAO, the proposal was removed at the author’s request. However, supporters are still looking for alternative methods to support Tornado Cash.

Arbitrum DAO Removes Proposal 

Tornado Cash developers Roman Storm and Alexey Pertsev are involved in a series of legal battles related to the development of Tornado Cash. The proposal sought to delegate up to $1.2 million worth of ARB tokens from Arbitrum’s community wallet to support the legal defense of the Tornado Cash founders. It also sought to allocate some of the budget for public relations and advocacy efforts to promote privacy-preserving technologies. 

The pseudo-anonymous delegate DK was behind the proposal, which was submitted on the 7th of March. The proposal called for a strong legal defense for the developers of Tornado Cash. 

“By rallying support for their legal fund, we aim to safeguard not only the future of privacy-preserving technologies but also the broader principles of innovation, decentralization, and individual sovereignty within our industry.”

However, an Arbitrum spokesperson stated that the proposal was removed at the author’s request. The reasons behind this request have also yet to be disclosed. 

“I can confirm that the forum was removed at the request of the author of the proposal.”

Supporters Looking For Alternatives 

Despite the Arbitrum DAO’s withdrawal of the proposal, Tornado Cash supporters are looking for other avenues to provide financial assistance to the embattled developers. One alternative is to channel funds through Coin Centre, a non-profit organization dedicated to crypto policy. The ultimate aim is to support WeWantJusticeDAO’s campaign to raise money to help cover legal costs, estimated to be around $100,000 per month. 

Tornado Cash developers have faced several setbacks when attempting to raise funds. Crowdfunding platform GoFundMe canceled a fundraiser to collect legal fees for Tornado Cash developers on the 16th of February. The company cited a breach of terms of services that could potentially expose GoFundMe, its employees, or users to harm or liability. 

“Yesterday, @gofundme notified the campaign organizers that the fundraiser for @rstormsf’s legal defense was canceled. They cite Term 22 of their terms of service, which can be interpreted to mean they simply didn’t like the fundraiser.”

Tornado Cash’s Legal Headaches 

Tornado Cash and its founders have come under considerable legal scrutiny thanks to the platform’s alleged role in laundering over $1 billion in illicit funds. This includes funds linked to the infamous North Korean hacker group Lazarus, which resulted in a series of significant legal actions initiated against the mixing service, including adding it to the United States sanctions list. This effectively bans residents of the USA from using the service, sparking intense debate within the crypto ecosystem. 

Advocates for Tornado Cash have argued that the service merely provides the software required for decentralized money transfers and does not directly engage in the act of money transmission itself. On this basis, they have challenged the charges against the developers of Tornado Cash. According to Coin Center, the Financial Crimes Enforcement Network (FinCEN) guidelines state that an anonymizing software provider must not be considered a money transfer. 

“These [legal] challenges not only threaten the developers’ ability to continue their work but also undermine the fundamental principles of decentralization and individual freedom upon which projects with privacy-preserving technologies are built.”

Storm and Pertsev face several legal charges from US authorities, including conspiracy to commit money laundering, conspiracy to commit sanction violations, and conspiracy to operate an unlicensed money-transmitting business.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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