Bitcoin Mixer Founders May Get Reprieve as DOJ Weighs Dropping Case

The developers behind banned Bitcoin mixing app Samourai Wallet are hoping their case will get dropped, given the new crypto-friendly president in the White House. 

A Monday letter from the Samourai Wallet co-founders’ legal team and prosecutors asked a court for a 16-day extension as prosecutors consider dropping the case.

The letter comes after the defendants in the case earlier this month wrote to the U.S. attorney for the Southern District of New York asking for the case to be dropped following the disbandment of the U.S. Department of Justice’s crypto-dedicated enforcement team. 

The DOJ said it would no longer pursue criminal charges against crypto exchanges, crypto mixing services, or holders of cold wallets—unless they are involved in embezzlement, scams, rug pulls and hacks. 

Samourai Wallet was a wallet with a bitcoin mixing service—an app allowing people to hide previous crypto transactions—that the feds shut down last year. Police in April 2024 arrested Keonne Rodriguez and William Lonergan Hill and seized the website. 

But the case has received less attention than that of Tornado Cash—an Ethereum mixing provider shuttered by U.S. authorities. 

Feds banned Americans from using Tornado Cash in 2022, saying that criminals had used it to launder dirty money. 

They then alleged that the app’s co-founders, Roman Storm and his colleague Roman Semenov, laundered more than $1 billion in criminal proceeds.

In response, America’s biggest crypto exchange, Coinbase, bankrolled a lawsuit arguing that the sanctioning of Tornado Cash was unjust. Privacy advocating politicians spoke about the case frequently, claiming that the app’s blacklisting was an attack on civil liberties. 

The United States Treasury last month said it had delisted Tornado Cash from its list of parties sanctioned by the Office of Foreign Assets Control, and a federal court on Monday permanently barred the body from reimposing sanctions on it. 

Since U.S. President Donald Trump took office in January, the DOJ and U.S. Securities and Exchange Commission has dropped a number of high-profile cases against crypto firms. Trump campaigned on a platform to help the industry and received backing from crypto and Silicon Valley bigwigs. 

Decrypt reached out to Rodriguez and Hill’s legal team for comment. 

Edited by James Rubin