Can Governments Accept Financial Systems They Cannot Control?

A bipartisan group of lawmakers in the U.S. House of Representatives has introduced a bill aimed at ending the prosecution of software developers who do not control other people’s crypto assets.

The DeFi Education Fund (DEF) says the bill would likely put a stop to cases like those brought against the developer of Tornado Cash and the creators of the Samourai wallet.

I agree with that assessment - but I have a different question: why were such prosecutions launched in the first place?

All this time, I had the impression that the creators of Tornado Cash and Samourai - who had no ability to interfere with users’ crypto transactions - were targeted precisely because they did not build backdoors. I assumed that governments, any governments, would make an example of developers who dared to create financial mechanisms that cannot be shut down on demand. They removed the state’s control - and that is why the state went after them. It is no coincidence that Satoshi Nakamoto chose to disappear. He created a similar mechanism.

And yet now, deep inside the very state that has been among the most aggressive in pursuing developers of permissionless financial tools, a bill has emerged that seeks to end this kind of prosecution.

Do you believe it will pass? If it does, it will seriously change my view of the potential role of governments in the crypto economy.

I am not counting on it - but I do hope for it. I wish the authors of the bill success.