Crypto Advocacy Groups Unite to Defend Vital DeFi Tools from DOJ Overreach

Key Points

1. The DOJ is suing developer Michael Lewellen, claiming his non-custodial DeFi tools violate money transmission laws under Section 1960 of Title 18 of the U.S. Code.

2. A coalition of crypto advocacy groups, including Paradigm and the DeFi Education Fund, has filed an amicus brief to challenge the DOJ's interpretation of the law.

3. The groups argue that the DOJ's stance could criminalize open-source software development by treating non-custodial tools as money transmission services.

4. A broad interpretation of Section 1960 could stifle innovation in DeFi by imposing legal risks on developers who contribute code without controlling its use.

5. The outcome of the case may influence the future legal environment for DeFi, potentially driving development offshore if the DOJ's interpretation is upheld.