The developer of Tornado Cash, Alexey Pertsev, looks set to remain in the custody of Dutch authorities until at least the next hearing of the ongoing trial, a Dutch court ruled.
Authorities arrested Pertsev in the Netherlands after the United States of America announced sanctions against the crypto privacy tool.
Tornado Cash Developer Remanded To Further Custody
A Dutch court has ruled that Alexey Pertsev, who was arrested in the Netherlands after the United States sanctioned the crypto privacy tool Tornado Cash, will remain in the custody of the authorities until the next hearing. With the next hearing scheduled for the 21st of April, 2023, Pertsev is set to remain behind bars for at least another three months as his trial on money laundering charges continues. Furthermore, the court has a pre-trial review on the 24th of May, 2023.
According to the panel of judges hearing the case at the East Brabant Court, the Russian web developer could flee or look to hide evidence if released on bail. Pertsev, on his part, has denied the charges leveled against him.
Pertsev’s Arrest And Charges
Pertsev’s arrest came soon after the United States Treasury announced sanctions against Tornado Cash. The US authorities alleged that the crypto mixing service was facilitating the laundering of funds by malicious entities and hackers, including a hacking group that the FBI believes has links to North Korea. Tornado Cash is an open-source protocol that allows users to pool in their crypto funds with others. It advocates the privacy of user funds and mixes and pools user funds within multiple wallets, thus helping to obfuscate the inflow and outflow of funds and helping anonymize transactions.
To sum it up, the FBI has accused Tornado Cash of laundering $7 billion worth of funds. This figure includes the $455 million stolen by the infamous North Korea-linked Lazarus Group. Meanwhile, the Dutch Ministry of Finance has accused Pertsev of “concealing criminal financial flows and facilitating money laundering through Tornado Cash. However, Pertsev has not yet been formally charged with committing any crime. However, he is being detained for 110-day intervals under a provision in Dutch law that allows authorities to hold the accused without formally being charged by the authorities.
Furthermore, Pertsev has also seen three appeals rejected by the court since his arrest. The latest appeal was denied as recently as November 2022.
Support For Pertsev Grows
Against this backdrop, support for Pertsev online has seen considerable growth, with prominent blockchain developers and users sharing a link to the FreeAlex page. There is also a Change.org petition that has accumulated over 5000 signatures supporting the Tornado Cash developer. The arrest has also drawn vocal protests from Edward Snowden and the larger crypto community, while the OFAC sanctions have come under stinging criticism from privacy advocates and crypto users.
Keith Cheng, Pertsev’s lawyer, called the hearing a good beginning in educating the court and authorities about the functioning of decentralized finance, stating that a lack of knowledge was the reason why Pertsev was behind bars. He explained,
“We had the opportunity to explain what the basis is for Tornado Cash and and why it is not money laundering. It is our opinion that the lack of knowledge is what’s keeping him here.”
However, Cheng expressed disappointment at the prospect that Pertsev would have to spend more time in jail, stating,
“Of course, I’m disappointed” that Pertsev won’t be released on bail. He will fight until the end to show what the importance is of decentralized options, software, and open source code.”
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.
