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Not exactly. They said "they came to know that some of the bitcoin moving through the service was derived from criminal activity, and they kept marketing and operating the service anyway." [1] The core issue of the case is that they were helping criminals commit crimes. If they just made a wallet and didn't know how people were using it, that's a different situation. FinCEN said they did not require a license, so it seems pretty clear that this is a plea deal. Plead guilty to the lesser charge, even if you are innocent, and end the stress of not knowing your fate. The prosecuters get a basically guaranteed win, the defendents probably get the prosecution to recommend some prison sentence less than the maximum and the judge decides whether to respect that recommendation or not. I'm not saying I am happy about the outcome, or that I agree that they are in fact guilty of the particular charge they are pleading guilty to; I'm just explaining the case and what developers in the US can learn from this case. If you are considering making wallet software, please get a lawyer, no matter what country you are in, whether you have control of the funds or not, are offer privacy features, etc. The whole thing is a lightning rod of controversy, seemingly unclear laws, and far too many jurisdictions. Or don't get a lawyer. I'm not the boss of you. 😄 [1]
Bitcoin Magazine
Samourai Wallet Developers Plead Guilty To Conspiring To Operate An Unlicensed Money Transmitting Business
15 months after being charged with conspiring to commit money laundering and conspiring to operate an unlicensed money transmitting business, the S...
I mean loads of people do and seem fine? This case always seemed to be more about making an example out of people who went a bit far poking the bear in their marketing - or potentially a honey pot FED operation all along given how shit a job it did (and that was all about to end anyway so it outlived its use for that purpose anyway.) But now precedent is a thing and now they have that so maybe we're all just fucked.
Lot's of nuance necessary here, and entirely unclear as neither Samourai Wallet nor Storm were convicted of licensing violations. What *is* clear is that non-custodial developers should not, under any circumstances, knowingly transmit criminal funds. Because the licensing requirement is unclear, it is also unclear *how* developers should do this. I'm not a lawyer and this is not legal advice, but I would either KYC+Chainalysis all the things, or immediately turn off your services for US users so that the DOJ cannot fabricate venue against you. View quoted note →
↩ replying to npub1c74f...556d
I liked this on Lightning and money transmission: https://medium.com/@ekladous/are-bitcoin-lightning-nodes-money-transmitters-24cc5f1a38c6 If you run a Lightning node, you are obviously running software that helps people to transmit money. However, the transmitter can't steal the money, and that article gives multiple other reasons why Lightning is expected to be safe from the regs But I'm still a bit nervous about this. Regulators might try to cause trouble for Lightning nodes
↩ replying to siggy47
I read the text of the law (it's very short, it seems!) but I'm still not sure where Lightning ⚡ fits into this If A pays C by Lightning, routing through channels involving B, then it could be argued that B transferred the money from A to C Of course, Lightning was designed to make it impossible for B to steal the money; B can take the money from A if and only if they first pay C. My fear is that regulators might still abuse this I guess I should do some research; I'm sure someone has thought of this already 😜