This is really big, and really bad news.
The essential point seems to be that there is an argument that they *could* have exerted control. Did they actually have backdoor keys into the smart contract after they wrote and deployed it? I can't remember a clarification on that crucial point.
If they didn't, then this is even worse, because it means US LE are prepared to make *really* tortuous arguments to go after privacy software developers.
In the not so distant future:
"A chain analysis firm identified a transaction involving Bitcoin linked to a government-opposed group that includes a Bitcoin address found in one of your social media posts. It appears you received a payment from Bitcoin that was previously held by this group. Can you explain your connection to this group? Can you prove that? Do you mind if we come in and ask you a few more questions?"
Every “upgradable” smart contract has a back door that allows the author to change the code. So it’s a fair assessment to claim that they did have control.
Depends on what functions can be upgraded. Also there's a limit to how convoluted an argument they'll get away with. The Coin Center article suggests that the DoJ is being a bit handwavy here.
I don’t think the essential point has anything to do with backdoors. It’s actually much worse than that.
They’re arguing that since the devs 1) made the software and 2) knew it would be used for “illegal” things, and yet 3) did nothing to stop this, that they are complicit.
What kinds of things could they have done to stop things? Not made the software in the first place. Attempted to take the software down after the fact. Or blocked certain inputs as Wasabi does.
Scary precedent
