On Nov. 6, 2025, Keonne Rodriguez, cofounder of Samourai Wallet, received the maximum penalty of five years in prison from Judge Denise Cote in the Southern District of New York for operating an unlicensed money transmission business. The ruling marks a turning point in the federal crackdown on privacy services in cryptocurrencies and has implications for developers, users of mixing tools, and operators relying on anonymity to move liquidity.
Samourai Wallet, launched in 2015 and shut down in April 2024, was a non-custodial mobile wallet designed to enhance the privacy of Bitcoin transactions through CoinJoin techniques, including features known as Whirlpool and Ricochet. Its stated purpose was transaction privacy on-chain through mixing methods that obfuscate inputs and outputs.
The prosecution claimed the software facilitated the laundering of at least $237 million linked to darknet markets, cyberattacks, frauds, and other crimes, and that the founders received approximately $6.3 million in fees — valued at about $26.9 million due to Bitcoin appreciation. According to the government’s memorandum, the indictment included messages where Rodriguez allegedly described mixing as “money laundering for Bitcoin” and promotions attributed to his cofounder about the ability to “clean dirty Bitcoin” and make transactions “untraceable”.
Context and impact for Samourai Wallet and privacy tools
Both founders accepted a plea agreement for conspiracy to operate an unlicensed money transmission business (18 U.S.C. § 1960); cofounder William Lonergan Hill will be sentenced on Nov. 7, 2025 before the same judge. The sentence exceeds the probation office’s technical recommendation of 42 months, after the prosecution pushed for the statutory maximum.
The conviction reinforces a trend of regulatory tightening cited by the government. Previous cases and penalties against intermediaries — for example, OKX (~$504 million), Brink’s ($42 million), Wynn Las Vegas ($130 million), and KuCoin (near-$300 million settlement and temporary exit from the U.S. market) — illustrate that both centralized platforms and privacy tools are under scrutiny.
For traders and managers, this implies greater regulatory risk over hidden liquidity flows and potential changes in access to services that facilitate anonymity, which may translate into greater volatility during capital flight or compliance adjustments.
Rodriguez’s sentence represents a milestone in the judicial criminalization of privacy services; the next verifiable event is Hill’s sentencing on Nov. 7, 2025, which could consolidate the punitive stance and define operational risks for developers and providers of anonymity tools.
