Dragonfly Capital can be in a dangerous trouble. The Federal Public Prosecutor told the New York Court that the Ministry of Justice weighs criminal charges against one of the company’s general partners regarding their investment in Tornado Cash. It is a sudden development in the trial of Tornado Cash Roman Storm And lift A greater question: Can investors be considered legally responsible for what their governor’s projects are doing?
The legal lights shine on Tom Schmidt
Tom Schmidt, a partner in Dragonfly, found that he was mentioned in the court when the Prosecutor indicated that the charges against him were still On the table. This comment was closed quickly From the record, but the message was clear. At the present time, he did not The accusation was madeAnd it is subject to serious scrutiny. This type of attention on the VC investor is rare, especially when they did not participate directly in daily operations.
Email messages from Dragonfly Surface in court
One of the reasons why the Ministry of Justice takes this angle is internal emails now as a guide. The messages from 2020 Dragonfly show discussion of compliance features with Tornado Cash developers, including things like Kyc. Both directions may be cut. On the one hand, it appears that the dragons were aware of organizational concerns. On the other sideand He – she It can be used To argue they Know the risks and distress in any case. Schmidt, for his part, refused to testify and summon the fifth amendment.
The dragonflies do not retreat
Haseeb Qureshi, another administrative partner in Dragonfly, has already responded publicly. He called the idea of criminal charges against the investor tampering. According to him, Al -Yasas obtained legal advice before InvestmentThe company did not manage, and certainly no person helped money. It is too overwrought The company’s commitment to privacy Technology and He said They have cooperated with the authorities since last year.
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If VC can It is shippedWhat next?
this You can put a new tape of legal risks in the encryption space. Imposing fees on investment capital Put the money in A project that later becomes the axis of penalties or implementation intimidation Other investors on. There is already a frequency about privacy technique, but this may take it more. Investors may start avoiding anything controversial remotely, even if the technology itself is neutral.
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Schmidt remains silent, and the defense takes the strike
With Schmidt refused, the defense team is losing a major opportunity to explain the side of the dragonfly from the story. His testimony could have helped show the storm that the developers were working with the partners who took compliance seriously. But since the government did not give immunity, Schmidt remained calm. This decision can affect how the rest of the case evolves.
A big picture of encryption and Defi
Romanian storm and his co -defender faces charges related to money laundering and its alleged relations with the approved groups, including the Lazaros Group in North Korea. Organizers clearly Expand the network. It is no longer related to developers. now, Supporters and investors may be drag In court also.
Is this another stage where all this organization will start following the encryption companies? It is definitely not logical for the Ministry of Justice to behave like this. This is bitter nonsense
I hope you win, comrades and come out like how Consensys did.
stay strong.
– Danny (@he3is_) July 25, 2025
Previous or snapshot?
So far, Schmidt has not done The accusation was made. but If the Ministry of Justice moves forwardThis can put a major precedent. If not, it is still sending a sign that no one in encryption is outside the border. Investors may need to think twice about what they are finance And how do they remain involved. This issue is no longer only about Tornado Cash. It relates to the place where the government draws the line.
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Main meals
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The Ministry of Justice is considering criminal charges against the dragon partner Tom Schmidt about the company’s investment at Tornado Cash.
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Internal emails appear from 2020 Dragonfly discussing KYC and compliance features with Tornado Cash developers.
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Schmidt evoked the fifth amendment and refused to make his testimony, which limits the ability to defend the role of the dragonflies.
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Haseeb Qureshi described the idea of imposing VC fees and said they followed the legal guidance.
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This issue can determine a new precedent, as investors face the legal exposure to encryption projects they return to.
Post Dragonfly investor may face the Ministry of Justice on the Cash Tornado bet, first appeared on 99bitcoins.