The suit seeks a declaratory judgment ensuring that the Department of Justice (DOJ) cannot prosecute his forthcoming project, Pharos, under money transmitting laws.

The legal action comes amid growing scrutiny of crypto developers and rising concerns about the future of privacy-focused blockchain projects in the U.S.

The Lawsuit: A Battle for Developer Rights
Lewellen’s lawsuit argues that the DOJ’s prosecution of developers who create noncustodial cryptocurrency software—tools that don’t manage user funds—is unconstitutional. The suit references ongoing cases against Roman Storm, the developer of Tornado Cash, and Keonne Rodriguez, co-founder of Samourai Wallet. Both men are accused of violating money laundering laws and face potential sentences of up to 45 and 25 years, respectively.

According to Lewellen, these prosecutions not only violate First and Fifth Amendment protections but also contradict the DOJ’s prior public statements. Historically, the DOJ claimed that developers are not money transmitters unless they maintain direct control over funds. Lewellen insists this inconsistency jeopardizes the entire crypto development ecosystem.

The Pharos Platform: A New Approach to Crowdfunding
Lewellen’s lawsuit seeks to preempt potential legal challenges to his upcoming project, Pharos, a blockchain-based crowdfunding platform. Built on Ethereum, Pharos leverages “assurance contracts,” smart contracts that guarantee donors a refund if projects fail to meet their funding goals.

The platform also incorporates privacy features, allowing contributors to remain anonymous. Lewellen argues that he will never control the funds passing through Pharos, receiving only a predefined fee for successful campaigns. This distinction, he claims, places Pharos outside the scope of money transmission laws.

Crypto Developers Under Fire
The lawsuit underscores a larger issue: the absence of clear regulatory guidance for crypto projects. Without defined rules, developers increasingly face enforcement actions that stifle innovation. Lewellen’s preemptive approach mirrors a broader trend of legal pushback. Last year, two NFT artists filed a similar suit against the U.S. Securities and Exchange Commission (SEC), seeking clarity on whether their work could fall under securities laws.

Cases like those of Tornado Cash’s Storm and Samourai Wallet’s Rodriguez have sent shockwaves through the crypto community. These prosecutions are seen by many as a direct assault on the development of privacy-enhancing blockchain tools. Critics argue that the government’s actions could chill innovation and erode constitutional rights.

What’s Next for the DOJ?
Lewellen’s lawsuit arrives during a transition of leadership at the DOJ. Attorney General Merrick Garland, appointed by President Joe Biden, is set to depart as the new administration begins. Former Florida Attorney General Pam Bondi, nominated by President Donald Trump to replace Garland, is awaiting Senate confirmation.

Observers believe that Bondi or an interim successor, such as Commissioner Mark Uyeda, could take a more favorable stance on crypto innovation. The lawsuit presents an opportunity for the DOJ to pivot from its enforcement-heavy approach and engage in meaningful rulemaking for the industry.