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DEF Authors New Paper Exploring Samourai Wallet & Money Transmitters


The DOJ’s case against Samourai Wallet’s founders surfaces critical questions about how financial regulations apply to privacy-enhancing technologies. 


In a new paper, the DeFi Education Fund’s Spencer Peek examines whether non-custodial tech tools can legally be classified as “money transmission,” and he argues that the DOJ’s interpretation stretches existing laws in ways that threaten innovation and due process.


Some of our favorite highlights from the paper:

  • “Rather than receiving value from users and transmitting it to another location on their behalf, Samourai provides the users with the necessary tools to enhance their privacy when sending bitcoin between addresses exclusively controlled by the user."

 

  • “The DOJ’s concession that the user’s private keys are never accessed by Samourai is fatal to its allegations.”


  • “The DOJ’s use of the term ‘facilitates’ fundamentally mischaracterizes the role that Samourai Wallet plays in transactions through both Whirlpool and Ricochet, which are merely privacy-enhancing tools for user-controlled peer-to-peer transactions on the Bitcoin network.”


If software developers can be prosecuted for writing open-source codes that never ‘take custody of user funds,’ how might this impact the future of financial privacy and our digital rights?


Read the full analysis here.


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