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CryptoQuant CEO stands in support of Samourai Wallet founders, defending their actions.

April 27, 2024
3 Min Reads

Ki Young Ju, CEO of CryptoQuant, has expressed support for the Samourai Wallet creators following their arrest by the US Department of Justice for allegedly operating a cryptocurrency mixing business linked to the laundering of about $100 million.

Ju has contested the accusations made against the founders and maintained the crypto mixer's function in safeguarding user anonymity.

Ju said, "The US DOJ has arrested pioneers in Bitcoin privacy technology," in an April 25 X post. One of the main principles of Bitcoin is privacy. Self-mixing is not illegal. Even cryptocurrency exchanges protect user privacy by using mixing.

Ju further emphasized that a feature's legality or illegality depends on how it is utilized and its purpose. He likened using a knife, which is both legal and unlawful, to using a Samourai wallet case. "It's like punishing the inventor of the knife instead of the one who uses it," the founder of CryptoQuant said.

Keonne Rodriguez and William Lonergan Hill, the owners of Samourai Wallet, have been charged by the DoJ with creating and running a website that allegedly allowed over $100 million in transactions linked to illegal activity.

The firm is said to have processed around $2 billion in illegal transactions since its launch in 2015, bringing in about $4.5 million in fees.

While Hill was imprisoned in Portugal and is awaiting extradition to the United States, Rodriguez was arrested and is set to be charged in Pennsylvania. The Samourai Wallet website, located in Iceland, was seized as part of the investigation, and a warrant was issued to take down the company's mobile app from the Google Play Store.

The creators deliberately advertised their business to anybody wishing to launder money from crimes, according to evidence uncovered in tweets and private chats. With over 100,000 downloads, the app was apparently made with the intention of catering to those who were involved in the black and grey markets, particularly during the COVID-19 epidemic.

Renowned whistleblower and proponent of digital privacy Edward Snowden also offered his opinion, denouncing the DoJ's conduct. "The Department of 'Justice' has once again criminalized the developers of an app that restores financial privacy," said Snowden in reference to X. To address this, money should be private by default. Never should privacy be considered "exceptional," or else it will be illegal.

Human rights activist Lyudmyla Kozlovska also commented on the matter, describing how American law enforcement may identify financial offenses using cryptocurrency.

"US law enforcement agencies are well-equipped to detect such crimes, as evidenced by the identification of a money laundering offense involving this specific wallet," Kozlovska said.

In addition, Kozlovska stated, "This is exactly what we talk about in our meetings with regulators: we understand that US law enforcement has all the tools to track Bitcoin transactions on the blockchain." She advocated against the criminalization of such technologies and the innovators behind them.

Aiming at privacy technologies enabled by smart contracts, the Federal Bureau of Investigation has cautioned Americans against utilizing unregistered cryptocurrency money-transmitting services.

The FBI advised Americans to only utilize registered cryptocurrency money services businesses that abide by current Know Your Customer (KYC) and Anti-Money Laundering (AML) rules in a public service advertisement on April 25.

The FBI stated in its announcement that it had recently carried out law enforcement operations against unlicensed cryptocurrency services in "accordance with federal law." It further stated that individuals who use unlicensed services may "encounter financial disruptions" during law enforcement actions, especially if the money is mixed up with funds obtained illegally.

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