Key Notes
- Protocol fees from Keyring's zero-knowledge DeFi vaults are allocated to defend developers charged with facilitating money laundering.
- The cases will establish legal precedent on whether open-source privacy software creators can be held liable for third-party misuse.
- Ethereum Foundation coordinates sustainable defense funding as a model for protecting developers building privacy-enhancing blockchain tools.
The Ethereum Foundation and Keyring Network have announced a collaborative initiative aimed at supporting the legal defense of Tornado Cash developers, Roman Storm and Alexey Pertsev, who are facing ongoing legal challenges in the US and Europe for creating privacy-focused, open-source code.
This program allocates all protocol fees collected from Keyring’s new zero-knowledge, permissioned DeFi vaults over an initial two-month period directly into the legal defense fund for the developers. As of September 10, the program has already collected $22,109.
Fees collected from Keyring Network on September 10 | Source: Keyring Network
Keyring Network specializes in compliant financial tools for DeFi, to validate users while maintaining privacy on the Ethereum ETH $3 835 24h volatility: 6.6% Market cap: $462.63 B Vol. 24h: $96.88 B blockchain. The initiative champions privacy in decentralized networks and links DeFi protocol growth to legal protection for developers who build privacy-enhancing tools.
Legal Battle Over Open-source Code
Tornado Cash has been a focal point in ongoing legal debates regarding developer liability, privacy, and sanctions compliance. Roman Storm and Alexey Pertsev are charged with facilitating money laundering and sanctions violations due to Tornado Cash’s alleged use by criminal entities and sanctioned groups.
The prosecution has claimed the developers knowingly operated a platform that supported illicit activity, while the defense maintains Tornado Cash was designed to foster financial privacy. Currently, Roman Storm has been found guilty of creating an illegal money transfer in the US.
The outcome of these cases is expected to set a precedent on whether creating open-source, privacy-centered software can be criminalized when misused by others. These trials have sparked an industry-wide debate on striking a balance between innovation and compliance. The legal defense fund is viewed as critical for supporting not only the individual developers but also for defending the broader principle of open-source development in Web3.
Ethereum Foundation’s Role in Developer Protection
The Ethereum Foundation is acting as a strategic partner, coordinating the fund and establishing a market-aligned mechanism for sustainable defense funding. In addition to organizing protocol fee donations, the Foundation has pledged direct support and launched matching campaigns to encourage community fundraising for the developers’ legal expenses.
The Foundation emphasizes that the program serves as a blueprint for integrating impact funding into decentralized ecosystems, without relying on sporadic donations or external grants.
Industry leaders argue that supporting the Tornado Cash developers is essential not only for individual rights but also for the future of privacy technology on Ethereum and beyond. The initiative highlights the Foundation’s ongoing commitment to the legal protection of developers working on privacy and security tools.
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