Federal prosecutors asked a Manhattan judge on Oct. 5 to uphold venue in the Southern District of New York for Tornado Cash co-founder Roman Storm's remaining criminal charges, the same week FinCEN formally abandoned its proposed crypto-mixer reporting rule.

In a letter filed with the U.S. District Court for the Southern District of New York, the U.S. Attorney's Office urged Judge Katherine Polk Failla to find venue proper for the money-laundering conspiracy and unlicensed-money-transmitting conspiracy counts that a jury deadlocked on in August 2025. The same jury convicted Storm of conspiracy to operate an unlicensed money-transmitting business.

Storm's Rule 29 motion for a judgment of acquittal, which contests the sufficiency of the prosecution's evidence, remains pending before Failla. The judge has scheduled a retrial for April 26, 2027.

Why does the government believe New York is the right venue?

The filing leans on United States v. Sterlingov, a Sept. 25 decision by the D.C. Circuit Court of Appeals involving the Bitcoin Fog mixer. In that case, the appeals court upheld venue in Washington, D.C., for money-laundering conspiracy and unlicensed money transmission counts based on transactions conducted with an undercover agent in the district.

Prosecutors argue the logic maps directly onto Storm's case. Testimony showed that user Shakeeb Ahmed accessed Tornado Cash from his Manhattan apartment, and the government contends his deposits helped the protocol's pools conceal funds — a local nexus sufficient, in its view, to anchor venue in SDNY.

Storm's defense team disagrees. In earlier filings, his lawyers argued that the Ahmed transactions did not materially further any alleged conspiracy and that the protocol's founders did not cause them. The venue dispute now sits alongside the pending acquittal motion as the two procedural gates between Storm and a 2027 retrial.

Storm himself framed the new filing against the backdrop of the Treasury Department's simultaneous regulatory retreat. "The DOJ is still coming after me with everything it has. They really want to see me convicted," he wrote on X, contrasting the prosecution's persistence with FinCEN's withdrawal of the mixer proposal.

What does the FinCEN withdrawal actually change?

FinCEN published a withdrawal notice effective Oct. 6 that abandons both its 2023 proposed reporting rule and its finding that international crypto mixing constitutes a class of transactions of primary money laundering concern.

The 2023 proposal would have required covered financial institutions to report transactions they knew or suspected involved mixing within or involving a foreign jurisdiction, and to retain associated customer records. FinCEN said its expansive definition of mixing risked a "chilling effect on legitimate activity" and would have imposed a large reporting burden on institutions.

The two developments sit on separate legal tracks. The FinCEN withdrawal concerns proposed compliance obligations for financial institutions; the SDNY filing determines where Storm stands trial on criminal charges. FinCEN said it will continue monitoring mixers for money laundering, terrorist financing and other illicit finance, and it reserved the option of further action.

What happens next?

The immediate question rests with Failla, who must rule on both the venue challenge and the Rule 29 acquittal motion before the April 26, 2027 retrial date holds. Her reading of the D.C. Circuit's Sterlingov precedent on venue — and of whether the Ahmed transactions materially furthered the alleged conspiracy — will determine whether the remaining counts stay in Manhattan, move, or collapse entirely.

For compliance teams, the FinCEN withdrawal removes a looming special-reporting regime, but not the underlying Bank Secrecy Act obligations that already cover suspicious activity. The agency's stated intent to keep watching mixer-related illicit finance signals that the enforcement posture, even as the rulemaking agenda narrows, has not softened.