Amidst the tempest of Roman Storm’s trial, federal prosecutors have whispered of potential charges against certain employees at Dragonfly Capital, a venture capital firm that once cast its lot with Tornado Cash.
The presiding Judge, with a gravity that could only be matched by the weight of the sealed statement, has kept the identities of the accused shrouded in mystery. Yet, it seems the possible charges will not rain down upon Dragonfly as a whole, nor its vast expanse of employees. General Partner Tom Schmidt, when called to the stand, chose the path of silence, invoking the Fifth Amendment with a flourish that would have made any seasoned lawyer proud.
Dragonfly Entangled in Tornado Cash Trial
The courtroom buzzes like a beehive as the long-awaited trial of Roman Storm, the enigmatic founder of Tornado Cash, unfolds before the eyes of eager court reporters. The prosecution, with the zeal of a hawk chasing its prey, sought to link the platform to specific victims and offshore dealings. In a twist of fate, they turned their gaze towards Tornado Cash’s early benefactor, Dragonfly Capital:
NEW from the @rstormsf trial: The DOJ is apparently still considering charges against an unspecified number of people at crypto VC firm @dragonfly_xyz, not just General Partner @tomhschmidt, according to AUSA Rehn.
After saying this in court, Rehn asked for the transcript of…
— Eleanor Terrett (@EleanorTerrett) July 25, 2025
Dragonfly Capital, a name well-versed in the cryptic world of cryptocurrency, was among the first to see the potential in Tornado Cash. The prosecution, ever the dramatist, presented a series of emails between Storm and Dragonfly’s executives, emails that hinted at a debate over the implementation of KYC guidelines. Some online pundits, with the wisdom of armchair generals, have speculated that Dragonfly advised Tornado Cash to eschew such guidelines, a claim as murky as the waters of the digital underworld.
Possible New Charges
US prosecutors, with a sternness that could curdle milk, have stated that they are contemplating charges against several Dragonfly employees, their involvement in Tornado Cash’s alleged misdeeds too tantalizing to ignore. These charges, however, are not meant to tar the entire firm or its myriad employees. The Judge, with a nod to the sanctity of justice, agreed to keep the details of this exchange under wraps.
The legal team of Tornado Cash, in a move that could be seen as either desperate or strategic, summoned Tom Schmidt to testify on behalf of the platform. Schmidt’s attorney, with a lawyer’s instinct for self-preservation, invoked the Fifth Amendment, arguing that his client should not be compelled to incriminate himself. Whether this gambit will succeed remains to be seen, but for now, Schmidt’s silence echoes through the courtroom.
The future of Dragonfly’s involvement in the Tornado Cash saga is as unpredictable as the weather. Should the prosecutors decide not to pursue criminal charges against the firm, it could spell trouble for Schmidt’s quest for immunity. After all, being called as a witness by the defense leaves him vulnerable to the whims of the court, even without the Fifth Amendment’s protective cloak.
For now, the trial is in a state of suspended animation, on recess until the weekend. Closing arguments, the final act in this drama, are set to unfold next week. Only time will tell how the winds of justice will blow in this stormy affair.
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2025-07-25 22:31