[NEW] Today, DeFi Education Fund & @blockchainassn published an amicus brief in the Samourai Wallet case in support of Keonne Rodriguez and William Lonergan Hill’s motion to dismiss the indictment.

Though the Judge denied the motion allowing amicus briefs in Samourai, we felt it important to share our perspective 🧵👇

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Our brief focuses on why Count II—the allegation that Rodriguez & Hill conspired to operate an unlicensed money transmitting business—should be dismissed.

As DEF has outlined previously, the government’s interpretation of 18 U.S.C. §1960(b)(2) is *fatally* flawed because software devs who NEVER custodied nor exercised control of any third party funds are not operating a money transmitting business.

Simply: “Providing the technology for a person to make their own transfer, without controlling the funds at issue, is not making that transfer ‘on behalf of’ someone else.”

We then explain that Count II violates due process and fair notice because the defendants relied on FinCEN’s 2019 guidance in good faith, which clearly states that non-custodial software providers are *not* money transmitters because they do not control user funds. 

The DOJ ignored this Guidance without notice or a reasoned explanation.

To start, we argue that Count II is inconsistent with the statutory text. 

Why? The plain meaning of the statutory language:

“Under the ordinary, common-sense understanding of §1960(b)(2), a defendant cannot ‘transfer’ funds ‘on behalf of’ another person if he does not have possession and control over the funds to begin with. Someone does not ‘transfer,’ ‘transmit,’ or ‘accept’ an object when he creates a neutral tool that other people use to move the object.”