The Arbitrum DAO is currently voting on whether to provide financial support for the legal defense costs of Tornado Cash’s developers. If approved, the community plans to donate up to 600,000 ARB tokens, equivalent to almost $1.3 million at the time of writing, within the first year.
A proposal was submitted by a pseudonymous delegate, DK, on March 7. The aim of the proposal is to fund a robust legal defense for Roman Storm and Alexey Pertsev, the developers behind Tornado Cash. Additionally, the funds could be used for public relations and advocacy efforts to raise awareness about privacy-preserving technologies and the legal challenges faced by developers.
The proposal has three tiers for voting, each corresponding to different funding levels, ranging from 200,000 to 600,000 ARB tokens. Currently, over 80% of the votes have been cast in favor of the highest tier. The deadline for voting is March 14.
Tornado Cash and its founders have faced accusations regarding the platform’s alleged involvement in laundering over $1 billion in illicit funds, including money associated with the North Korean hacking group, Lazarus Group. Consequently, Tornado Cash has faced significant legal actions, such as being added to the United States sanctions lists, effectively prohibiting residents of the country from using the service and sparking controversy within the cryptocurrency community.
Supporters of Tornado Cash argue that the platform merely provides software for decentralized money transmission and does not directly engage in money transmission itself. This challenges the basis of the charges against the developers. Coin Center, a crypto advocacy group, states that according to the Financial Crimes Enforcement Network (FinCEN) guidelines, an anonymizing software provider should not be considered a money transmitter.
Storm and Pertsev are facing various charges from U.S. authorities, including conspiracy to commit money laundering, conspiracy to commit sanctions violations, and conspiracy to operate an unlicensed money-transmitting business. The first two charges carry a maximum sentence of 20 years in prison each, while the charge for operating an unlicensed money-transmitting business is punishable by up to five years in prison.
This community proposal comes shortly after the crowdfunding platform GoFundMe canceled a fundraiser that aimed to collect legal fees for Storm and Pertsev. The cancellation was due to a breach of GoFundMe’s terms of service, which could potentially expose the platform, its employees, or users to harm or liability of any kind.