U.S. Pursues Five-Year Prison Terms in Cryptocurrency Privacy Lawsuit, Challenging Developer Responsibility

U.S. authorities are seeking five-year prison terms for Keonne Rodriguez and William Lonergan Hill, the co-founders of Samourai Wallet—a cryptocurrency privacy platform accused of laundering more than $237 million in illegal proceeds from 2015 to 2024. Both men admitted guilt in July to running an unlicensed money transmitting business and are scheduled for sentencing on November 6 and 7, 2025, as reported in a

. The prosecution’s filing, which requests the maximum sentence allowed under 18 U.S.C. §371, reflects a broader governmental push to target crypto mixing services and privacy-oriented tools, as detailed in a .

The charges claim that Samourai Wallet, which promoted itself as a privacy-centric

wallet with coin-mixing capabilities, enabled transactions linked to narcotics, cybercrime, and fraud. Prosecutors allege the platform’s activities—collecting 246.3 BTC in fees (valued at about $269 million)—amounted to a “large-scale money laundering operation” that knowingly catered to criminal clientele, according to a . Hill, who was the chief technical officer, acknowledged in a letter to the court that he promoted the service to “computer hackers and other criminals,” further strengthening the prosecution’s argument, as referenced in another .

Defense lawyers, on the other hand, have called the prosecution’s sentencing request “excessively severe.” Rodriguez’s legal team asked for a sentence of one year and one day, while Hill’s attorneys requested credit for time already served, emphasizing that both men cooperated with investigators and accepted responsibility, according to

. The Probation Office suggested a 42-month sentence for each, but prosecutors insisted on the full 60 months, citing the gravity of the offenses and the importance of deterring similar conduct in the crypto industry.

This case has been likened to the ongoing proceedings against Tornado Cash, a decentralized crypto mixer whose co-founder, Roman Storm, was found guilty in August of operating an unlicensed money transmitting business. Storm was acquitted of related money laundering and sanctions violations, a decision that drew criticism from privacy advocates who argue that developers should not be blamed for how users utilize their creations. The Samourai and Tornado Cash cases together illustrate the Justice Department’s approach of holding platform operators responsible for crimes committed through their services, even if users act independently.

Legal analysts caution that the results of these cases could shape how U.S. regulators interpret liability within decentralized finance (DeFi). Government filings indicate a belief that developers can be held accountable for criminal use of their platforms if they maintain operational control or influence through marketing—a stance that could discourage innovation in privacy-focused crypto projects. Samourai, which ceased operations after its founders’ arrests in April 2024, had advertised its coin-mixing as a method to “conceal transaction trails,” a claim now cited by prosecutors as proof of deliberate concealment.

The upcoming sentencing hearings in November will determine whether the court upholds the prosecution’s full recommendation or opts for the Probation Office’s lesser sentence. If the court sides with the government, it could signal stricter regulation for crypto privacy tools; a lighter sentence might encourage continued development in the field. As the digital asset industry navigates the balance between privacy and regulatory demands, these cases highlight the increasing friction between technological progress and government oversight.