U.S. Government Seeks Maximum 5-Year Sentence for Samourai Wallet Developers
The U.S. Department of Justice is seeking the maximum five-year prison sentence for the two developers behind Samourai Wallet, a Bitcoin privacy app accused of operating an unlicensed money-transmitting business and facilitating money laundering.
According to court filings from the Southern District of New York, prosecutors allege that the developers built and promoted tools like Whirlpool and Ricochet, which allowed users to mix Bitcoin transactions and obscure their origins.
Authorities claim the platform processed more than $2 billion in cryptocurrency transactions, with over $100 million allegedly tied to illegal sources such as dark web marketplaces and fraud schemes.
The Government’s Case
Prosecutors argue that Samourai’s features were designed to make tracing transactions nearly impossible, effectively turning the service into a laundering tool.
“Financial privacy is not a crime,” the DOJ statement read, “but tools that knowingly enable criminals to hide illicit funds cross the line into facilitation.”
The government is pushing for the maximum penalty under the unlicensed money-transmitting statute, a move seen as both a deterrent and a statement on crypto privacy enforcement.
The developers are also accused of earning millions in fees through the anonymizing services, which prosecutors claim proves they were operating as an active financial intermediary rather than a neutral software provider.
The Defense: “Code Is Speech”
The defense maintains that Samourai was non-custodial, meaning users always retained control of their private keys.
Under previous FinCEN guidance, such tools are not considered money transmitters because they do not actually handle customer funds.
Defense attorneys argue that prosecuting software developers for writing open-source privacy code violates the First Amendment, chilling innovation and threatening financial privacy rights.
“Our clients wrote code,” one attorney said outside the courthouse. “They didn’t launder money.”
They also accused the DOJ of withholding communications suggesting FinCEN officials previously advised that non-custodial wallets do not require licensing — a revelation that, if verified, could weaken the prosecution’s foundation.
A Compromise in Sentencing
While money-laundering charges can carry decades-long sentences, prosecutors are reportedly pursuing a maximum five-year term instead, signaling a more measured approach amid growing debate about privacy tools and regulation.
Legal observers see the reduced sentencing demand as an acknowledgment of the gray area between privacy technology and financial facilitation, particularly as more privacy-focused crypto projects operate without custody of user funds.
The Broader Impact on Bitcoin Privacy
The case has sparked outrage among Bitcoin privacy advocates and developers worldwide.
Critics warn that criminalizing privacy software developers could drive innovation offshore and set a precedent that any open-source developer could be held liable for user behavior.
Meanwhile, regulators are calling the prosecution a milestone in defining the limits of “financial anonymity” under U.S. law.
The case follows similar crackdowns on Tornado Cash and other mixing services accused of laundering criminal proceeds.
The verdict is expected to have far-reaching implications for the future of open-source privacy tools and Bitcoin’s role in preserving — or challenging — financial surveillance.
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