Today, the acting assistant attorney general (AAAG) of the Department of Justice (DOJ) Criminal Division (DOJ) Matthew Galeotti spoke at an event hosted by the American Innovation Project.
AAAG GALEOTTI began speaking by telling the audience that Deputy Attorney General (DAG) Todd Blanche asked the audience to tell them about the DOJ’s focus on “equal enforcement of law” in the digital assets field.
In a talk by AAAG Galeotti, he referenced the note Dag Blanche, published in April. The memo said Dag Blanche will end regulations due to the enforcement approach that is popularized by the Biden administration as DOJ is associated with the crypto industry and crypto developers.
AAAG Galeotti repeatedly reinforced some of the points from the Blanche memo, creating many quotable moments in the process.
Here are some of the high notes he hit:
“The department will not use federal criminal law to create a new regulatory regime in the digital asset industry. The department will not use the charges as a legal production tool. The department cannot speculate on innovators who could lead to criminal prosecution.”
“In our view, writing code without maliciousness is not a crime. It is not a crime for the economy to innovate new ways to accumulate value and generate wealth.”
“In general, developers of neutral tools should not be liable for anybody else’s misuse of these tools that have no criminal intent. If a third party misuse violates criminal law, that third party should be prosecuted and not a well-intentioned developer.”
The prominent voices of the crypto industry have posted some of these promising quotes on X.
Other prominent figures in the industry have expressed their skepticism and highlighted some of the quotes from AAAG Galeotti’s speech.
Listen to myself and say I feel optimistic, or even cautiously optimistic, I’m off from it. (Maybe I feel a bit of the latter.)
But most of the time I feel healthy skepticism, the most comparable to Vanbalkenberg’s.
Put another way, I believe that the developers of Samourai and Roman Storm, co-founders of Tornado Cash, will still be charged with this narrative, especially in the wake of some of the AAAG Galeotti that took place later.
These comments included the following comments (something without quotation marks is included for context):
“He or she is not criminally liable for the developer to donate code to an open source project without supporting, helping to a particular crime, or taking part in a criminal conspiracy.”
“As the DAG memo reveals, the Department of Justice does not claim a regulatory violation in the case of digital assets, such as digital assets not transmitted under 1960(b)(1)(a) or(b), as it knows certain legal requirements and does not have evidence of intentional violations. It is intended to be derived from criminal defense or be used to support illegal activities.”
“If the software is truly decentralized and only automates peer-to-peer transactions, and evidence indicates that third parties do not manage and control user assets, the new 1960(b)(1)(c) claim will not be approved.
Having covered both Samourai wallets and tornado cash cases, we have seen much of the “evidence” used in both cases to explain the developer’s criminal intent.
Many of them were rhetoric related to developers who respond to bad actors using software they created in illegal activities.
The worst example of this is when the Samourai developer invited Russian oligarchs to avoid sanctions.
If I’m speaking clearly now, one of the main lessons that cryptography developers should learn from the Samorai and Tornado cash incidents is not even joking about bad actors using your services.
That being said, it’s not illegal to joke about it. In the case of the Roman storm, he made efforts to stop bad actors from using tornado cash, including implementing chain analysis oracles on the front end of tornado cash.
But I’m off track here a bit…
What I am trying to do is that AAAG Galeotti’s comments about criminal intent can be interpreted widely. And because of this, they overturn many of the more positive points he’s made about DOJ not prosecuting crypto developers.
And I agree with Van Balkenberg. This means that we must continue to promote the Safe Harbor Congress through the Blockchain Regulations Certification Act (BRCA).
Because even after this seemingly positive story from AAAG Galeotti, developers are still at risk.
This article is a take. The opinions expressed are entirely the authors and do not necessarily reflect the opinions of BTC Inc or Bitcoin Magazine.
Source: https://bitcoinmagazine.com/legal/curb-your-enthusiasm-assistant-attorney-general-galeottis-talk-changes-very-little
