Twister Money indictment fails to point out ‘clear violation’ of sure legal guidelines: Coin Heart

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Crypto advocacy group Coin Heart has criticized the newest indictment of two former Twister Money builders, arguing that the information supplied do not present any clear violations of money-transmitting-related offenses.

Roman Storm and Roman Semenov have been indicted by the USA Workplace of International Asset Management on Aug. 23 for conspiring to function an unlicensed money-transmitting enterprise, amongst different expenses.

In a follow-up opinion piece, Coin Heart analysis director Peter Van Valkenburgh argues that the claims within the indictment seem to run counter to steering from the USA  Monetary Crimes Enforcement Community — arguing that Twister Money solely supplies the software program to transmit cash moderately than transmitting the cash itself.

“The one factor the indictment claims concerning the defendants’ unlicensed cash transmission is that they ‘engaged within the enterprise of transferring funds on behalf of the general public’ and did so with out registering with FinCEN,” wrote Valkenburgh.

However does the indictment state any information that truly present that the defendants engaged in any actions that qualify as cash transmission underneath the related legislation?

He pointed to an interpretation by FinCEN as to what constitutes “cash transmission providers” underneath the U.S. Financial institution Secrecy Act, which states:

“An anonymizing software program supplier is just not a cash transmitter.”

An excerpt from FinCEN’s Digital Foreign money Steering from 2019. Supply: FinCEN.

Valkenburgh then referred to a different excerpt stating that solely individuals utilizing the software program will be thought-about cash transmitters:

“[A] individual that makes use of the software program to anonymize the particular person’s personal transactions will likely be both a person or a cash transmitter, relying on the aim of every transaction.”

Whereas Valkenburgh mentioned that Twister Money made it simpler for people to make use of the protocol’s good contracts to transmit cash, he argued it doesn’t imply that the builders have been cash transmitters themselves.

“[But] that doesn’t in some way imply that they turned transmitters merely as a result of they supplied instruments that others used to transmit their very own cash,” Valkenburgh defined.

Valkenburgh additionally criticized claims within the indictment suggesting that Storm and Semenov had full management over the protocol’s good contracts.

“Ethereum good contracts are variable and typically individuals don’t have any management over their operation, some management, or complete management. That is the important thing truth wanted to find out whether or not one is performing cash transmission,” he argued.

Associated: Crypto lobbyists nonetheless combating to axe ‘illegal’ Twister Money sanctions

Coin Heart first voiced its opposition towards the U.S. Treasury in October when it sued the company for its unprecedented and illegal sanctioning of Twister Money.

The OFAC indictment claims Storm and Semenov ran an unlicensed cash transmission service by participating within the enterprise of transferring funds on behalf of the general public. The enforcement company claimed the builders ought to have registered with FinCEN.

Semenov was added to OFAC’s checklist of Specifically Designated Nationals and Blocked Individuals on Aug. 23, whereas Storm was arrested by the Federal Bureau of Investigation in Washington state on the identical day.

Alexey Pertsev, one other one in all Twister Money’s founders, was imprisoned by Dutch authorities in Aug. 2022 earlier than being launched in late April.

Valkenburgh believes the result of the Twister Money saga could have a profound influence on the authorized rights of United States residents to construct and publish software program sooner or later.

Journal: Journal: Twister Money 2.0 — The race to construct protected and authorized coin mixers