Samourai Wallet Developers Throw in the Towel, Plead Guilty to Operating Unlicensed Money-Transmitting Business
The creators of Samourai Wallet, a popular privacy-focused Bitcoin wallet, have pleaded guilty to a single count of conspiracy to operate an unlicensed money-transmitting business. This plea deal marks a significant turn of events in the case, which has been closely watched by the crypto community. By pleading guilty, the developers – Keonne Rodriguez and William Lonergan Hill – have managed to avoid a potentially lengthy and costly trial.
The Plea Deal: A Pragmatic Hedge?
As part of the plea agreement, the developers will face a maximum of five years in prison, a $400,000 fine, and a whopping $237 million in forfeiture. In exchange, the parallel money laundering conspiracy charge has been dismissed. This deal has been seen as a pragmatic move by the defense, rather than an admission of guilt or a vindication of the US Department of Justice’s (DOJ) theory. Amanda Tuminelli, executive director of the DeFi Education Fund, argued that the DOJ’s interpretation of the law is misguided, and that the pleas don’t change the ongoing policy debate about how to regulate open-source wallet software.
A Risk Calculation
Tuminelli’s comments highlight the complexity of the case and the nuances of the law. The plea deal can be seen as a risk calculation, where the developers have chosen to avoid the uncertainty and potential risks of a trial. As Tuminelli put it, “Plea deals are risk calculations.” This statement underscores the idea that the developers have made a strategic decision to minimize their potential losses, rather than a moral or ethical one.
Case Background: A Global Operation
The Samourai Wallet case has been a global operation, involving authorities from the US, Iceland, Portugal, and the EU. On April 24, the authorities shut down the wallet’s domain and web infrastructure, and seized its assets. The Android app was also removed from Google Play for US users. The prosecution alleged that the founders had run a mixing service through Samourai, which had processed over $2 billion in Bitcoin tied to illicit activity, including $100 million linked to dark-web markets.
The case has sparked a heated debate about the regulation of cryptocurrency and the role of law enforcement in policing the industry. The Samourai Wallet was one of the most popular privacy-focused Bitcoin wallets, with over 100,000 downloads. The outcome of this case will likely have significant implications for the crypto industry, and will be closely watched by developers, investors, and regulators alike.
