• Samourai Wallet’s Whirlpool and Ricochet tools obscured Bitcoin transactions, processing 80,000 BTC and evading financial safeguards to launder illegal proceeds.

• Hill and Rodriguez promoted the service for illicit uses, earning over $6 million in fees before pleading guilty to conspiracy charges.

• Internal messages revealed founders’ awareness of criminal exploitation, with tools designed specifically to hide Bitcoin trails from law enforcement.

Samourai Wallet sentencing shocks crypto world: Co-founder Hill gets 4 years for laundering $237M in BTC. Discover tools, evidence, and implications for privacy services. Stay informed on regulatory shifts today.

What is the Samourai Wallet sentencing outcome?

Samourai Wallet sentencing resulted in William Lonergan Hill, the platform’s co-founder and chief technology officer, being sentenced to four years in federal prison for conspiring to operate an unlicensed money-transmitting business. The New York federal judge emphasized how Hill’s tools made it nearly impossible for victims of hacks and fraud to recover stolen funds. Both Hill and co-founder Keonne Rodriguez, who received five years, must serve three years of supervised release and pay $250,000 fines each, alongside forfeiting $6.3 million in platform fees.

How did Samourai Wallet’s tools facilitate illegal activities?

Samourai Wallet’s core features, Whirlpool and Ricochet, were explicitly designed to anonymize Bitcoin transactions and bypass anti-money laundering safeguards. Whirlpool, introduced in 2019, pooled user funds to break traceability on the blockchain, while Ricochet added deliberate extra steps to obscure sender-receiver links. These tools handled over 80,000 BTC—valued at more than $2 billion at the time—generating $6 million in fees, according to U.S. Department of Justice records. Prosecutors highlighted that 26% of mixed coins were linked to criminal activities, including ransomware and darknet markets, as analyzed by blockchain forensics firm Chainalysis.

This comes after Samourai Co-Founder Keonne Rodriguez got five years in prison, and both founders have been ordered serve supervised release, pay $250K each

Key Highlights

• Prosecutors say Samourai’s Whirlpool and Ricochet tools were built to hide Bitcoin trails, processing 80,000 BTC in ways that evaded safeguards.
• Hill and Rodriguez promoted the mixer for illicit use and earned over $6M in fees before pleading guilty to lesser charges.
• Internal chats showed the founders knew criminals used Samourai, with Rodriguez calling mixing “money laundering for bitcoin.”

William Lonergan Hill, the Chief Technology Officer and Co-Founder of the cryptocurrency mixing service Samourai Wallet, has been sentenced to four years in federal prison for helping criminals hide more than $237 million in illegal funds.

A federal judge in New York delivered the sentence, noting that Hill’s actions made it significantly harder for victims of hacks, fraud schemes, and other crimes to ever recover their stolen money.

Hill pleaded guilty earlier this year to conspiring to operate an unlicensed money-transmitting business. Prosecutors said Samourai Wallet was built to obscure Bitcoin (BTC) movement in ways that deliberately bypassed financial safeguards.

The four-year sentence comes after Keonne Rodriguez, CEO and Co-Founder of the Samourai Wallet, was sentenced to five years in federal prison on November 6. In addition to their prison time, both men have been ordered to serve three years of supervised release and pay $250,000 each in fines. They also forfeited more than $6.3 million, the fees Samourai earned, toward a larger forfeiture order tied to the criminal proceeds moved through the platform.

Tools designed to hide Bitcoin trails

In the sentence, prosecutors said Samourai Wallet was engineered to obscure Bitcoin transfers and evade financial safeguards, making it difficult for law enforcement and exchanges to trace suspicious transactions.

Two key features drove this effort. “Whirlpool,” a mixing service launched in 2019, shuffled Bitcoin between groups of users so the original source of the coins disappeared within the blockchain.

Another tool, “Ricochet,” added extra, unnecessary hops to a transaction to break the link between a sender and receiver. Together, these features processed more than 80,000 BTC, worth over $2 billion at the time, and generated more than $6 million in fees.

Evidence of encouraging criminal use

Investigators also pointed to messages and online posts showing that Hill and Rodriguez actively encouraged criminal use. Hill advertised the service on the darknet forum Dread, telling users looking to “clean dirty BTC” that Samourai’s Whirlpool tool was the better option. 

In 2020, Rodriguez also urged hackers behind a major social media breach to channel stolen funds into the mixer, later expressing disappointment when they chose another service.

Internal communications showed the Co-Founders fully understood how Samourai was being used. In one WhatsApp exchange, Rodriguez described mixing as “money laundering for bitcoin,” and Samourai’s marketing materials acknowledged that part of its customer base consisted of dark-market participants moving illegal proceeds.

The investigation involved cooperation from the Internal Revenue Service (IRS), Federal Bureau of Investigation (FBI), Europol, Icelandic authorities, and Portuguese law enforcement, who helped secure Hill’s extradition from Portugal in 2024.

The case has drawn significant attention in the crypto world because it raises major questions about privacy tools. Prosecutors argue that if a service is designed to help hide criminal money, it clearly breaks the law, regardless of the technology used.

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Frequently Asked Questions

What charges did Samourai Wallet co-founders face in the sentencing?

William Lonergan Hill and Keonne Rodriguez were charged with conspiring to operate an unlicensed money-transmitting business under U.S. law. They pleaded guilty, facing penalties for facilitating the laundering of over $237 million in illicit Bitcoin through privacy-focused tools that evaded regulatory oversight.

Why was Samourai Wallet targeted by U.S. authorities?

Samourai Wallet was investigated for its role in obscuring criminal Bitcoin transactions, making it a go-to service for hackers and darknet operators. Federal agencies, including the IRS and FBI, collaborated internationally to dismantle the platform, citing its deliberate design to bypass anti-money laundering protocols and hinder law enforcement tracing.

Key Takeaways

• Regulatory Scrutiny on Mixers: The Samourai Wallet sentencing underscores U.S. authorities’ zero-tolerance for crypto services enabling money laundering, processing billions in potentially illicit funds.
• Impact on Privacy Tools: While aimed at user anonymity, tools like Whirlpool and Ricochet were repurposed for crime, leading to severe penalties and asset forfeitures exceeding $6 million.
• Broader Crypto Implications: This case signals heightened enforcement; developers and users should prioritize compliance to avoid similar legal risks in the evolving regulatory landscape.

Conclusion

The Samourai Wallet sentencing marks a pivotal moment in cryptocurrency regulation, with co-founders William Lonergan Hill and Keonne Rodriguez facing substantial prison terms and fines for their roles in concealing illegal funds through innovative yet illicit Bitcoin mixing tools. As authorities intensify efforts against privacy-enhancing services vulnerable to abuse, the industry must balance innovation with compliance. Looking ahead, this ruling could reshape how crypto platforms operate, urging greater transparency to foster trust and legality in the digital asset space.