Tornado Cash Co-founder Released Under House Arrest Amid Legal Battle

Tornado Cash co-founder Alexey Pertsev has been released from prison and placed under electronic monitoring as he appeals his money laundering conviction.

Key Takeaways: – Tornado Cash co-founder Alexey Pertsev was released from prison on February 7 but remains under house arrest with electronic monitoring. – Pertsev’s release follows a U.S. court ruling overturning sanctions on Tornado Cash.

Pertsev, sentenced in May 2024 to five years and four months in prison, was granted a suspension of his pretrial detention on February 6 by a Dutch court. He was officially released on February 7, though he remains under house arrest.

Speaking on social media after his release, the Tornado Cash co-founder acknowledged the limitations of his new conditions. “It is not real freedom, but it is better than prison,” he said.

The ruling follows months of unsuccessful bail petitions and comes amid shifting legal perspectives on Tornado Cash. The U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned the cryptocurrency mixing service in August 2022, citing its alleged role in laundering over $7 billion, including $455 million tied to North Korean hacking group Lazarus.

However, in November 2024, the U.S. Fifth Circuit Appeals Court ruled that OFAC had overstepped its authority, stating that Tornado Cash’s immutable smart contracts could not be classified as property. This decision was reinforced in January 2025 when a U.S. District Court in Texas overturned the sanctions, marking a significant shift in regulatory policy.

Pertsev’s case has drawn criticism from privacy advocates who argue that prosecuting developers of open-source software sets a troubling precedent. Despite claims that Tornado Cash co-founders had no control over transactions processed through the protocol, Dutch authorities convicted Pertsev of money laundering in May 2024. His legal team is now preparing to challenge that conviction.

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