The U.S. Department of Justice (DOJ) has announced a significant change in its approach to cryptocurrency enforcement, signaling it will no longer pursue criminal charges against software developers who create decentralized platforms without criminal intent. This decision marks a dramatic departure from previous enforcement actions and highlights the evolving relationship between U.S. regulators and the rapidly expanding digital asset sector.
“Writing Code Is Not a Crime”
Speaking at a cryptocurrency summit in Wyoming on Thursday, Acting Assistant Attorney General Matthew Galeotti of the DOJ’s criminal division stated that developers will not be prosecuted for failing to register as money transmitters simply because they wrote code for decentralized financial platforms.
“Our view is that merely writing code, without ill-intent, is not a crime,” Galeotti said during his remarks, underscoring the DOJ’s recognition of the fundamental distinction between creating open-source technology and operating an illegal financial service.
This shift provides some long-awaited clarity for developers in the decentralized finance (DeFi) space, many of whom have expressed concerns that existing laws could unfairly criminalize the act of creating software.
Why This Matters: Money Transmission Laws and Crypto
Under current U.S. law, money transmitters—such as Western Union or payment apps like Venmo—must register as money service businesses and adhere to strict compliance measures. These include Know Your Customer (KYC) protocols and reporting suspicious activities to prevent money laundering and terrorist financing.
However, decentralized platforms often operate without intermediaries or user oversight, raising complex regulatory questions. Developers have long argued that they lack the ability to monitor transactions or enforce compliance, making traditional licensing requirements impractical and stifling for innovation.
Tornado Cash Case Highlights Legal Gray Areas
The DOJ’s revised stance follows a controversial case involving Tornado Cash, a privacy-focused crypto service that enables users to obscure transaction trails. Earlier this month, a jury convicted Roman Storm, one of Tornado Cash’s co-founders, of conspiring to operate an unlicensed money transmission business. However, the jury could not reach a verdict on additional charges of money laundering and sanctions evasion.
Prosecutors argued that Tornado Cash facilitated the laundering of illicit funds, including those linked to criminal organizations and sanctioned entities. Critics countered that Storm merely wrote open-source code, sparking a heated debate over whether developers should be held responsible for how their technology is used.
The case drew widespread attention across the crypto community, with many warning that holding developers criminally liable for code could set a dangerous precedent for software innovation.
Regulatory Shift Reflects Changing Priorities
The DOJ’s announcement is part of a broader recalibration in U.S. crypto policy. In recent months, the department disbanded its dedicated crypto enforcement team, signaling a step back from aggressive prosecution in the space. Similarly, the U.S. Securities and Exchange Commission (SEC) has dropped several high-profile cases against crypto firms and executives.
This shift stands in stark contrast to the Biden administration’s earlier crackdown on the industry, which included multiple lawsuits and criminal charges against leading exchanges and DeFi projects. The move also comes as the Trump administration—expected to take a more crypto-friendly stance—positions itself to influence the regulatory environment further. Reports have even suggested the former president’s family is exploring opportunities in the crypto business.
What’s Next for the Industry?
While the DOJ’s new approach is likely to be welcomed by developers and advocates for open-source innovation, it does not eliminate all legal risks. Platforms that knowingly facilitate illicit activity will remain under scrutiny, and the debate over how to regulate decentralized technologies without stifling innovation continues to intensify.
For now, the message from the DOJ is clear: writing code, by itself, will no longer be treated as a crime. This marks a pivotal moment for the U.S. crypto landscape and could encourage more developers to engage with blockchain technologies without fear of criminal liability—provided they steer clear of criminal intent.
