Convicted Bitcoin Fog mixing service operator appeals in a verbal hearing; a landmark case awaits as U.S. cross-border enforcement of crypto services faces a precedent-setting ruling

BlockBeats News, May 13 — The U.S. Court of Appeals for the District of Columbia heard oral arguments on Tuesday regarding the conviction appeal of Roman Sterlingov, operator of Bitcoin Fog, a Bitcoin mixing service. This case tests a core theory of the U.S. Department of Justice — that global internet encryption services that serve U.S. users and conduct cross-border fund transfers are subject to U.S. money transmission laws, even if the service operates mainly abroad.

Defense attorneys argued that the U.S. government “artificially created” jurisdiction by deploying undercover agents for small transactions, questioning whether this standard could allow any website to be subject to U.S. law; prosecutors emphasized that Bitcoin Fog intentionally served international (including U.S.) users and must comply with U.S. regulations. The judges also questioned the reliability of the FBI’s “IP overlap” analysis linking Sterlingov to the service, considering it lacked scientific validation. The outcome of this case will impact similar prosecutions against privacy tool developers like Tornado Cash and Samourai Wallet, as well as U.S. cross-border enforcement boundaries for cryptocurrency services.