The post US Opposes DeFi Fund’s Brief in Ethereum MEV Case Retrial Review appeared on BitcoinEthereumNews.com. The US government opposed the DeFi Education FundThe post US Opposes DeFi Fund’s Brief in Ethereum MEV Case Retrial Review appeared on BitcoinEthereumNews.com. The US government opposed the DeFi Education Fund

US Opposes DeFi Fund’s Brief in Ethereum MEV Case Retrial Review

  • Mistrial declared in November after jury deadlock on guilt in wire fraud conspiracy.

  • Prosecutors seek retrial in late February or early March 2026 in Southern District of New York.

  • DEF warns case creates fear among DeFi developers, potentially stifling US innovation (per their December 19 draft).

US opposes DeFi Education Fund brief in Peraire-Bueno brothers $25M Ethereum case. Explore legal battle’s impact on MEV bots, DeFi growth. Read key details on retrial motion now.

What is the Peraire-Bueno brothers case?

The Peraire-Bueno brothers case involves Anton and James Peraire-Bueno, accused of exploiting Ethereum’s blockchain using automated maximal extractable value (MEV) bots to steal approximately $25 million. In April 2023, prosecutors alleged the brothers intercepted pending transactions, manipulated them for profit through front-running, and laundered proceeds. A mistrial was declared in November 2024 after the jury deadlocked, prompting a motion for acquittal now under review.

Why did US Attorney oppose the DeFi Education Fund amicus brief?

Interim US Attorney Jay Clayton filed opposition on December 30, 2024, in the US District Court for the Southern District of New York. He argued the DeFi Education Fund’s (DEF) brief duplicates legal issues already ruled on by Judge Jessica Clarke and offers no novel insights tied to the acquittal motion. Clayton stated, “DEF does not provide any new information relevant to the current motion.” This stance aligns with prior rejections of similar briefs, like one from Coin Center during the trial. DEF’s December 19 draft had urged dismissal, claiming such prosecutions foster uncertainty that drives DeFi developers overseas.

The case underscores tensions in applying wire fraud and money laundering statutes to blockchain activities. Sources familiar with court filings note the government’s push for a retrial date in late February or early March 2026. Initial charges against the brothers include conspiracy to commit wire fraud, conspiracy to launder money, and conspiracy to transport stolen property, each carrying up to 20 years if convicted.

MEV, or maximal extractable value, refers to profits validators or bots extract by reordering transactions in Ethereum blocks. Legitimate MEV strategies enhance network efficiency, but prosecutors claim the brothers’ actions crossed into fraud by targeting a victim transaction for $10 million, netting $25 million overall. Ethereum’s proof-of-stake transition in 2022 amplified MEV opportunities, drawing regulatory scrutiny.

Industry observers, citing filings from groups like Coin Center—a non-profit focused on cryptocurrency policy—highlight risks to innovation. Coin Center’s trial brief challenged the government’s theory that MEV bots inherently violate laws designed for traditional finance. Prosecutors dismissed it as disconnected from facts.

DEF echoed these concerns, stating in their draft, “[P]rosecutions like this one create confusion and fear among software developers, discouraging involvement in DeFi and pushing participants to other countries.” The Department of Justice’s approach, they argued, misapplies outdated statutes to novel tech, hindering blockchain growth.

Frequently Asked Questions

What charges do the Peraire-Bueno brothers face in their Ethereum MEV case?

The brothers face charges of conspiracy to commit wire fraud, conspiracy to commit money laundering, and conspiracy to transport stolen property, based on a 2023 scheme allegedly extracting $25 million via MEV bots on Ethereum. Conviction on each could yield up to 20 years in prison, per US District Court documents.

How does MEV work in Ethereum and why is it controversial in the Peraire-Bueno case?

MEV in Ethereum involves reordering transactions in blocks to capture extra value, like arbitrage. In this case, it’s controversial because prosecutors allege the brothers used bots to front-run a $10 million victim transaction illegally. Defenders view MEV as a core blockchain feature, not fraud, promoting debate on regulating DeFi tools.

Key Takeaways

  • Government opposition to DEF brief: Highlights rejection of external input restating dismissed arguments during acquittal review.
  • Mistrial background: Jury impasse in November 2024 followed two-week trial on $25 million Ethereum exploit.
  • Industry implications: Case may deter DeFi developers by blurring lines between innovation and crime—monitor for retrial developments.

Conclusion

The US government’s opposition to the DeFi Education Fund amicus brief in the Peraire-Bueno brothers case intensifies scrutiny on MEV practices in Ethereum and DeFi. As Judge Clarke weighs the acquittal motion and potential 2026 retrial, the outcome could clarify legal boundaries for blockchain developers. Stakeholders should track Southern District of New York filings for precedents shaping crypto regulation.

Source: https://en.coinotag.com/us-opposes-defi-funds-brief-in-ethereum-mev-case-retrial-review

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