Overview
- The Northern District of Texas, which ruled Wednesday, dismissed Michael Lewellen’s suit without prejudice for lack of a credible enforcement threat.
- Chief Judge Reed O’Connor cited a DOJ memo that tells prosecutors not to charge crypto services for users’ actions or unknowing violations.
- Lewellen’s planned tool, Pharos, routes crypto donations to crowdfunding campaigns without holding funds, so he argued he need not register as a money transmitter.
- The court said past cases he cited, including Tornado Cash and Samourai Wallet, turned on alleged laundering, which it viewed as unlike his stated plan.
- Industry groups that filed briefs, including Coin Center and the Blockchain Association, now push Congress to pass Senator Cynthia Lummis’s 2026 bill to exempt non-custodial developers.