It's Friday! In today's Daily, Tornado Cash co-founder Roman Storm's motion to dismiss is denied, Senator Lummis says Republican control of the Senate would benefit digital assets, U.S. spot Bitcoin BTC 1.22% ETFs see their largest inflows since July and more.

Meanwhile, MMORPG MapleStory's web3 version wants to leverage nostalgia to draw players, Danny Park writes.

Let's get started.

Tornado Cash co-founder Roman Storm to face trial as US judge rejects motion to dismiss

A U.S. federal judge has ruled that Tornado Cash co-founder Roman Storm will face trial on the DOJ's alleged money laundering charges after denying his motion to dismiss the case.

• While serving legitimate privacy purposes, sending funds to a mixer like Tornado Cash is also a common tactic used by cybercriminals to make it harder for law enforcement to track and recover stolen crypto.
  In an indictment last August, federal prosecutors alleged Storm "knowingly facilitated" the crypto mixer's laundering of over $1 billion in criminal proceeds.
• Storm argued that the First Amendment protected his part in developing the Tornado Cash software. However, Judge Katherine Polk Failla of the Southern District of New York said the "functional capability" of code is not speech as defined within the First Amendment, CoinDesk reported.
• "Judge Failla's ruling denying [Storm's] motion to dismiss the indictment is an assault on the freedom of software developers everywhere," Variant Fund Chief Legal Officer Jake Chervinsky wrote. "This will go down in history as a perversion of law and a travesty of justice."
• Storm and fellow co-founder Roman Semenov face charges of conspiracy to commit money laundering and violate the
• International Economic Emergency Powers Act, each carrying up to 20 years in prison, plus a charge of operating an unlicensed money transmitting business, with a maximum five-year sentence.
• Storm's trial is scheduled to start on Dec. 2 in New York and is expected to last two weeks. Meanwhile, Semenov remains at large.

Lummis says Republican Senate would benefit digital assets

In an interview with CNBC on Friday morning, Sen. Cynthia Lummis said a flip to a Republican-controlled Senate following this year's elections would bode well for digital assets.

• In that scenario, crypto-friendly Republican Sen. Tim Scott would likely chair the influential Senate Banking Committee, replacing the more crypto-critical Democrat Sen. Sherrod Brown, she explained.
• The senator also criticized the SEC for regulating crypto through enforcement actions rather than clear guidelines, contributing to ongoing court cases with firms like Binance and Coinbase.
• Lummis argued that Congress, not the SEC, should take the lead in regulating the crypto industry by passing legislation with clear rules.

US spot Bitcoin ETFs attract largest inflows since July

U.S. spot Bitcoin ETFs registered $365.7 million worth of net inflows on Thursday — the largest since late July.

• It marks the sixth consecutive day of positive flows into the funds totaling $862.4 million, contributing to cumulative net inflows of $18.3 billion since they began trading in January.
• Ark Invest's ARKB led Thursday's net inflows, with $113.8 million, followed by BlackRock's IBIT, with $93.4 million, and Fidelity's FBTC, with $74 million.
• Meanwhile, the U.S. spot Ethereum ETFs returned to marginal net outflows of $100,000 on Thursday, as negative flows out of Grayscale's higher-fee converted ETHE product continued to overwhelm positive flows into other funds.

Bitcoin price breaks out above $66,000 amid positive inflation data

Bitcoin broke above $66,000 on Friday morning, buoyed by lower-than-expected inflation data, marking its highest price since late July.

• The Federal Reserve's key inflation gauge, the Personal Consumption Expenditures (PCE) index, fell to 2.2% in August, coming in below economists' expectations and sparking optimism about monetary easing boosting risk assets like crypto.
• "Today's lower-than-expected PCE numbers have strengthened the dovish sentiment sparked by last week's rate cut, fueling optimism that inflation pressures are cooling faster than anticipated," 21Shares crypto research strategist Matt Mena told The Block.
• Mena added that the favorable inflation data could lead to a retest of the $68,000 to $70,000 range for bitcoin, with global factors, including China's recent liquidity injections, further supporting its price.

Base's total value locked crosses $2 billion

The total value locked on Base, a Layer 2 Ethereum network incubated by Coinbase, has surpassed $2 billion for the first time, positioning it as the second-largest optimistic rollup by deposits after Arbitrum.

• According to DeFiLlama data, Base's TVL currently stands at $2.1 billion, up from about $430 million at the start of 2024, marking a 370% growth rate year-to-date.
• Decentralized exchange Aerodrome is the largest contributor to Base's growth, generating over $1 billion in deposits, followed by Uniswap's $220 million on the Layer 2.

Looking ahead to next week

• UK GDP figures are released on Monday. Eurozone CPI data are due on Tuesday. U.S. jobless claims numbers are out on Thursday, followed by U.S. nonfarm payrolls on Friday.
• ECB President Christine Lagarde and U.S. Federal Reserve Chair Jerome Powell will speak on Monday.
• Mainnet kicks off in New York on Monday.

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