A coalition of 34 crypto companies and advocacy groups has called on the US Congress to curb the DoJ “overly expansive” interpretation of money-transmitting laws, warning that it could criminalize blockchain developers.
In a letter sent on March 26 to key congressional committees, including the Senate Banking Committee and the House Financial Services Committee, the group argued that the DOJ’s stance threatens the future of software development in the US digital asset industry. The letter was spearheaded by the DeFi Education Fund and backed by major industry players, including Kraken and Coinbase.
The crypto firms criticized the DOJ’s use of money-transmitting laws to charge Tornado Cash developers Roman Storm and Roman Semenov with money laundering in August 2023.
According to the coalition, this interpretation disregards existing guidance from the Treasury’s Financial Crimes Enforcement Network (FinCEN) and creates a dangerous precedent.
DOJ’s Interpretation Sparks Legal Concerns
The letter highlighted how the DOJ’s position hinges on two sections of the US Code—Title 31, Section 5330 and Title 18, Section 1960—which define and criminalize unlicensed money-transmitting businesses. However, the crypto firms argue that FinCEN’s 2019 guidance makes it clear that software developers who do not control customer funds should not be considered money transmitters.
By ignoring this guidance, the DOJ is essentially contradicting FinCEN, creating legal ambiguity that could ensnare law-abiding developers. The coalition warned that if left unchallenged, this interpretation could stifle innovation, as developers may fear criminal prosecution simply for publishing non-custodial software.
The coalition also cited the DOJ’s recent prosecution of Samourai Wallet co-founders Keonne Rodriguez and William Lonergan Hill on similar charges, calling it part of a growing trend of regulatory overreach. Both developers have pleaded not guilty.
Call for Clarity and Protection
The letter called on Congress to intervene, warning that the DOJ’s stance risks driving crypto innovation out of the US. It argued that without clearer legal protections, the mere act of writing or releasing DeFi-related code could expose developers to prosecution.
The growing legal battle has also prompted individual action. In January, Coin Center fellow Michael Lewellen sued US Attorney General Merrick Garland, seeking a legal declaration that his release of non-custodial crypto software is protected under the Constitution.
As the crypto industry faces increasing regulatory pressure, the coalition’s letter underscores mounting frustration over conflicting interpretations of financial laws, which many argue are being misapplied to decentralized technologies.
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