The Stanford Blockchain Membership has slammed the U.S. Division of Justice's (DOJ) prosecution of Twister Money builders Roman Storm and Roman Seminov, calling it an overreach of outdated federal cash switch legal guidelines.

In a report titled “Twister Money and the Boundaries of Cash Transfers,” the membership notes that the Division of Justice makes use of 18 USC § 1960, the legislation concentrating on unlicensed cash switch companies, to Objected to the imposition of prices on the builders of primarily based protocol.

A 2023 Justice Division indictment labeled Twister Money an “unlicensed cash switch operation” that allowed customers to anonymize their cryptocurrency transactions.

The Stanford Blockchain Membership notes that this legislation was written earlier than the arrival of blockchain expertise and addresses the subtleties of decentralized protocols like Twister Money, which function by immutable good contracts with out intermediaries or directors. He claimed that the scenario had not been addressed.

In line with the report:

“The aggressive utility of 18 USC § 1960 by the Division of Justice raises broader questions concerning the dangers of increasing the statutory language to cowl new applied sciences. and judicial authorities to exceed the scope of the Structure and circumvent Congress's legislative authority.

The report highlighted the constitutional implications of utilizing government enforcement to manage rising applied sciences. It warned that such practices circumvent democratic processes and danger stifling innovation by conflating respectable makes use of of privateness instruments with unlawful practices.

Stanford College is understood for its management in each legislation and expertise innovation, and has a historical past of tackling advanced regulatory challenges. The Blockchain Membership report continues this custom by delving into the strain between privateness rights and regulatory oversight within the digital monetary area.

The Twister Money scandal highlights the rising debate about monetary privateness and the danger that these new applied sciences shall be misused by unhealthy actors.

Supporters, together with the Stanford Blockchain Membership, argue that protocols like Twister Money meet respectable privateness wants by permitting people to guard their identities throughout transactions. are. Critics, alternatively, argue that these instruments facilitate cash laundering and different unlawful actions.

The discharge of this report marks a major contribution to the continuing dialogue on how the US authorized system can adapt to DeFi applied sciences. It stays to be seen whether or not the judiciary will contemplate such criticism because it continues to grapple with the complexities of blockchain regulation.

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