The contradiction between presidential announcements and actions taken by the Department of Justice: can the USA really be considered a Bitcoin country?
Following the executive order signed by President Donald Trump, which established the creation of a strategic bitcoin reserve, the idea of a “Bitcoin Country” has once again circulated in part of the community, especially the American one.
With the opening to digital assets and the inclusion of seemingly pro-Bitcoin figures in key positions of the administration, America would seem to present itself as a country at the forefront of technological innovation and economic freedom, following the President’s promise to transform the USA into the “global capital of cryptocurrencies”.
However, examining the concrete actions of the judicial system and federal agencies of the United States, a contradictory picture emerges. In recent years, the Department of Justice (DoJ) has pursued whistleblowers, privacy activists, and developers of technologies closely linked to Bitcoin and cryptocurrencies. To understand if the United States can truly be considered a Bitcoin-friendly country, it’s worth examining the actions beyond the announcements.
Roman Sterlingov: the Bitcoin Fog case and the controversial use of Chainalysis
Roman Sterlingov, a Russian-Swedish citizen, was arrested in April 2021 on charges of being the creator and operator of Bitcoin Fog, one of the first bitcoin mixing services, active since 2011. After a month-long trial, Sterlingov was sentenced to 12 and a half years in prison in August 2024 for money laundering, operating an unlicensed money transmitting business, and conspiracy.
The Sterlingov case represents a particularly concerning precedent for several reasons:
- the use of contested forensic evidence: the entire prosecution was based on on-chain analyses provided by Chainalysis through its proprietary software Reactor. During the trial, it emerged that Chainalysis was unable to provide evidence of the scientific validity of its program or its error coefficients. The Chainalysis investigation lead, Elizabeth Bisbee, admitted to being “unaware” of scientific evidence regarding the accuracy of the software;
- contradictory testimonies: CipherTrace, another on-chain analysis company, stated that they found no evidence linking Sterlingov to the management of Bitcoin Fog, highlighting discrepancies between their methodology and that of Chainalysis;
- refusal of external audit: during the trial, Chainalysis managed to avoid any external audit of its software, which could have revealed possible flaws in the heuristics used.
Despite the critical issues with the presented evidence, the court considered the evidence provided by Chainalysis to be reliable, convicting Sterlingov. In addition to imprisonment, Sterlingov will have to forfeit seized funds worth $1.76 million and 1,345 BTC present in the Bitcoin Fog wallet, worth over $103 million.
Roman Storm: the legal battle of the co-founder of Tornado Cash
Roman Storm, co-founder of the privacy protocol Tornado Cash, was arrested in August 2023 on charges of money laundering, sanctions violations, and operating an unlicensed money transmitting business.
Tornado Cash is a decentralized protocol based on smart contracts, designed to enhance privacy on Ethereum through transaction mixing. Prosecutors argue that Storm is personally responsible for the illicit use of the protocol by third parties, despite Tornado Cash being non-custodial and therefore not managing user funds. The DoJ argued that Storm should have implemented KYC controls (Know Your Customer) and blocked addresses sanctioned by Ofac. The prosecution considers Storm as an “operator” of the service, claiming that he profited from control over Tornado Cash.
Storm is free on a $2 million bail awaiting trial, which will not take place before April 2025.
Samourai Wallet: the founders of the privacy-focused wallet under accusation
William Lonergan Hill and Keonne Rodriguez, founders of the privacy-focused Bitcoin wallet Samourai Wallet, were arrested in late April 2024 on charges of conspiracy to launder over $100 million from criminal activities and operating an unlicensed money transmitting business. Samourai Wallet is known for its privacy features, including the implementation of CoinJoin and other tools that enhance the fungibility of bitcoin.
During the latest hearing at the Southern District of New York court, the prosecution presented evidence that allegedly included an escape plan found in Rodriguez’s residence. The defense argued that it was a generic emergency plan.
Both developers are currently under house arrest, with restrictions on their movements. The two face a maximum sentence of 25 years in prison.
Defense attorneys are still analyzing over 8 terabytes of evidence provided by the prosecution. The trial date has been set for November 3, 2025.
Edward Snowden: the whistleblower’s exile
In 2013, Edward Snowden, a former National Security Agency contractor, revealed the existence of mass surveillance programs by the government agency. Snowden’s revelations showed the world how the indiscriminate collection of billions of terabytes of private citizens’ data by the NSA had not prevented any terrorist attack, as publicly claimed by American authorities. For this, Snowden was forced to flee the United States and currently lives in Russia, where he obtained citizenship in 2022.
Over the years, Snowden has publicly expressed his support for Bitcoin and other technologies that promote financial freedom and privacy. Snowden has also used bitcoin to fund his legal expenses and support his life in exile.
Despite some of Snowden’s revelations leading to limited surveillance reforms in the United States, such as the USA Freedom Act of 2015, which placed some restrictions on data collection, Snowden remains accused of espionage and theft of government property. If he were to return to the United States, he would face trial risking decades in prison.
Julian Assange: freedom after years of unjustified detention
Julian Assange, founder of WikiLeaks, gained his freedom in June 2024 after reaching a plea deal with the American Department of Justice, ending a 14-year legal battle. Assange returned to Australia after spending five years in the maximum-security Belmarsh prison in London and over seven years in the Ecuadorian embassy in the English capital.
After traditional payment companies blocked donations to WikiLeaks in 2010, the organization began accepting bitcoin, becoming one of the first use cases for censored financial transactions.
Thanks to bitcoin donations received over the years, it is estimated that WikiLeaks has accumulated considerable assets, which helped cover Assange’s legal expenses.
The plea deal stipulated that the WikiLeaks founder plead guilty to a minor offense under the Espionage Act, thus avoiding a trial in the United States. The sentence was set at 62 months, considered already served during his detention in the United Kingdom.
Ross Ulbricht: Trump’s pardon after a decade in prison
Ross Ulbricht, creator of the darknet market Silk Road, was released on January 21, 2025, after receiving a pardon from President Trump, ending the sentence established in 2015.
Ulbricht, who had no prior criminal record, was sentenced to two life sentences without the possibility of parole for non-violent charges related to the creation and management of Silk Road. The trial was characterized by several unusual events, including the corruption of two federal agents involved in the investigation, who were later convicted of misappropriating seized bitcoins.
The pardon granted by Trump was enthusiastically welcomed by the Bitcoin community.
Larry Harmon: the Helix case and collaboration with the DoJ
Larry Harmon, creator of the bitcoin mixing service Helix, was arrested in February 2020 on charges of facilitating the laundering of over 350,000 bitcoins (approximately $300 million at the time) between 2014 and 2017. In August 2021, Harmon pleaded guilty to conspiracy to launder money.
Unlike Sterlingov, Harmon agreed to collaborate with the DoJ, testifying against other defendants in similar cases, including Sterlingov himself.
Harmon was sentenced to three years in prison and three years of supervised release. As part of the plea deal, the creator of Helix agreed to forfeit over 4,400 bitcoins and pay a fine of $60 million.
Virgil Griffith: the former Ethereum researcher convicted for speaking in North Korea
Virgil Griffith, a former researcher at the Ethereum Foundation, was arrested in November 2019 for giving a presentation on blockchain and cryptocurrencies at the “Pyongyang Blockchain and Cryptocurrency Conference” in North Korea.
In September 2021, Griffith pleaded guilty to conspiracy to violate international sanctions, and in April 2022, he was sentenced to 63 months in prison and ordered to pay a fine of $100,000.
U.S. prosecutors accused him of helping North Korea use cryptocurrencies to evade sanctions.
His sentence was recently reduced by seven months, bringing it to 56 months.
The exit of Bitcoin companies from the US market
In recent years, the intensification of the crackdown against financial privacy tools has triggered an exodus of Bitcoin services and wallets from the US market. The sequence of departures began on November 24, 2023, when Wallet of Satoshi, a popular Lightning Network payment app, abandoned the American market. The Australian company removed its application from Apple and Google stores in the USA.
Subsequently, in April 2024, following the arrest of the founders of Samourai Wallet, the FBI issued a warning against the use of financial services without Money Services Business licenses. As a result, Acinq withdrew its Phoenix wallet from the US market on April 26, followed the next day by zkSNACKs, which blocked access to the Wasabi Wallet website for all American citizens and residents.
The cases presented seem to reveal a dual reality for the United States when it comes to Bitcoin and freedom technologies.
On one hand, the American market has embraced Bitcoin as an asset class, with ETFs, financial services, and growing political recognition. On the other hand, the judicial system and federal agencies have shown hostility toward some fundamental aspects of Bitcoin: financial privacy, resistance to censorship, and economic sovereignty.
