A crypto coder’s invention was used by North Korean hackers. Did he commit a crime?

The 35-year-old software developer is set to go on trial this summer in a case that cryptocurrency advocates consider a key test for the legal treatment of blockchain technology. The crypto industry has rallied behind Storm, and some of his allies have called for President Trump to intervene and drop the prosecution, which began during the Biden administration.

Storm and two other developers co-founded Tornado Cash, a “mixer" used to obfuscate the movement of digital funds. He says its goal was to enable financial privacy—for instance, allowing people to donate crypto to assist war-torn Ukraine without drawing the attention of Russian authorities.

It also enabled more sinister activity. The Justice Department has alleged that criminals, including Lazarus Group, a U.S.-sanctioned North Korean cybercrime organization, used Tornado Cash to launder more than $1 billion of illicit assets. According to prosecutors, Storm and his co-founders made millions of dollars from Tornado Cash and knew that hackers used it to launder stolen assets.

Under Trump, who has vowed to make the U.S. the “crypto capital of the world," the Securities and Exchange Commission has backed off from civil lawsuits meant to force regulation of crypto companies. But the Justice Department hasn’t stopped criminal prosecutions focused on crypto fraud or money laundering.

Storm told The Wall Street Journal in an interview that most of Tornado Cash’s users were legitimate. He called the service a neutral piece of software that could be used for both good and bad purposes.

“Hackers and bad actors use Microsoft Excel," he said, speaking by Zoom from the same house in Auburn, Wash., where he was arrested a year and half ago. “Should Microsoft developers feel bad for what they’ve done? I think no."

Storm, who was released on bail, has pleaded not guilty. Prosecutors have charged him with conspiracy to commit money laundering, conspiracy to commit sanctions violations and conspiracy to operate an unlicensed money-transmitting business. He faces a maximum sentence of 45 years in prison.

One of Tornado Cash’s other co-founders, Roman Semenov, was charged alongside Storm but remains at large. The third co-founder, Alexey Pertsev, was arrested in the Netherlands in 2022 and convicted by a Dutch court last year of money laundering.

A spokesman for the Manhattan U.S. attorney’s office, which charged Storm, declined to comment.

Authorities worldwide have cracked down on other crypto mixers, saying they laundered the proceeds of ransomware attacks, illicit drug sales and other crimes. But Tornado Cash was different from earlier mixers.

The core technology of Tornado Cash ran autonomously on the Ethereum blockchain, fulfilling users’ requests to obscure the movements of crypto assets. Storm said he couldn’t control Tornado Cash once it was fully deployed, so there was no way he could stop criminals from using it.

Prosecutors have pushed back against Roman Storm’s arguments that he had zero control over Tornado Cash.

Some crypto firms victimized by cyber-thieves contacted Storm and his co-founders when they saw millions of dollars of stolen funds flowing through Tornado Cash—and Storm declined to help, prosecutors say. In the interview, Storm said he could do nothing and felt “really bad" about such interactions.

“I gave my honest answer," he said. “Some people assumed that I had some sort of backdoor control, or that I could freeze some funds and stop it somehow. But no, I don’t."

Prosecutors have pushed back against Storm’s arguments that he had zero control over Tornado Cash. In court filings, they have argued that Storm and his colleagues ran a web-based interface for Tornado Cash and maintained a network of “relayers" to give users additional privacy. The Justice Department has described Tornado Cash as a profit-seeking business, whose founders cashed in through the sale of digital tokens, called TORN.

In September, U.S. District Judge Katherine Polk Failla rejected Storm’s bid to dismiss the case. “The Tornado Cash enterprise was not an altruistic venture," she said. Storm’s jury trial is set to begin July 14 in Manhattan.

Crypto heavyweights such as Ethereum founder Vitalik Buterin and Matt Huang, co-founder of venture-capital firm Paradigm, have voiced support for Storm, while several crypto trade groups filed briefs criticizing the government’s case. Paradigm gave $1.25 million for Storm’s legal fees, and Huang raised the case during Trump’s White House crypto summit earlier this month.

“Roman is being unfairly prosecuted," Huang told the Journal. “Software developers shouldn’t be threatened with criminal sanctions for building neutral infrastructure, which is what Tornado Cash was. You wouldn’t throw Tim Cook in prison because criminals use iPhones."

Storm’s allies have been encouraged by the Trump administration’s intervention in other criminal cases, such as its push to drop the bribery prosecution of New York Mayor Eric Adams. The charges against Storm were filed by the same federal prosecutors’ office that charged Adams.

“We don’t think this case ever would have been brought now," said Brian Klein, an attorney for Storm. “This was brought when Biden had declared war on crypto."

On Friday, the Treasury Department lifted Biden-era sanctions on Tornado Cash, following a November court ruling that deemed the sanctions an overreach of government authority.

Raised in the industrial Russian city of Chelyabinsk, Storm emigrated to the U.S. in 2008 and later became a U.S. citizen. He worked for tech companies such as Cisco Systems and Amazon.com before pivoting to blockchain technology.

Court filings show a turning point for Tornado Cash was the March 2022 hack of online game “Axie Infinity," in which cybercriminals stole more than $500 million of crypto—and funneled much of it through Storm’s mixer. When officials attributed the hack to North Korea’s Lazarus Group, Storm messaged his co-founders, “Guys, we are f—ed," prosecutors say.

Storm and his lawyer, Klein, said he cooperated with the investigation. In November 2022, they said, Storm voluntarily met federal law-enforcement officials in New York to discuss Tornado Cash.

Nine months later, Storm was arrested.

Write to Alexander Osipovich at alexo@wsj.com