The US Department of Justice (DOJ) has clarified that it will not currently pursue allegations against the dragonfly ventures on the initial investment of the firm in a crypto-mixing protocol, a crypto-mixing protocol, under the legal investigation.
This in earlier reports suggest that the financial support of the project in 2020 can face the Venture Capital Firm legal action. Haseeb Qureshi, co-founder of the Dragonfly Ventures, confirmed the updated stance of the DOJ in a statement shared on the social media platform X on Tuesday.
According to Qureshi, prosecutors admitted during Monday’s test session that previous claims about possible allegations were wrong. The DOJ reportedly stated that neither the dragonfly nor any of its officers are targets in any ongoing investigation related to tornado cash.
DOJ Nirt Room clarified the situation after speculation
On Friday, the DOJ publicly suggested the possibility of prosecuting the dragonfali as part of a comprehensive investigation into tornado cash activities, a statement that Qureshi described by Qureshi as both unusual and incompatible with DOJ guidelines.
He emphasized that federal prosecutors have been banned from specifically in front of the media from specifying a possible third-party prosecution in the open court.
Qureshi said in his post, “This type of public statement may have widespread implications.” “It may discourage investment in blockchain and privacy-centric technologies if investors are afraid that they may face prosecution for open-source development.”
He said that DOJ’s comments were initially visible with the aim of discouraging the dragonfly representatives in the ongoing tornado cash trial.
The Reversal comes as the Roman Storm, which is the co-founder of the Tornado Cash, facing legal proceedings on the allegations of the conspiracy and the violation of the laws of US restrictions. The prosecutors argue that the protocol provided illegal transactions by uncleoring the origin of funds moving through its network.
Like other privacy-growing devices, Torneado Cash has been a point between the open-source financial privacy and money laundering and the theft of restrictions and a point of dispute between advocating concerns about the theft of restrictions.
Implications for crypto investment and open-source development
The Decision of DOJ to clarify its attitude has been welcomed by members of the venture capital and blockchain communities, many of which expressed concern about the possible chilling effects, such legal threats can be on the financing of privacy-conservation technologies to such legal threats.
Qureshi said that from Friday, the dragonfali had received significant support from industry colleagues, who saw the earlier comments of DOJ as a risk of legitimate investment activities.
With the DOJ, now stating that it would not chase the dragonfly, the attention is back into the Roman Storm test, which can reach the arguments at the end of this week.
The matter is being closely monitored in the Cryptocurrency sector due to its ability to set legal examples for open-source development and privacy rights in digital finance.
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