Recent federal litigation highlights how existing criminal statutes intersect with rapidly evolving blockchain technologies. In US v. Peraire-Bueno (S.D.N.Y.), two young brothers stand accused of a $25 million complex crypto-currency exploit on the blockchain, Ethereum. Federal prosecutors have charged them with conspiracy to commit wire fraud, substantive wire fraud, and conspiracy to commit money laundering. Under these charges, prosecutors claim the brothers used a tactic called “sandwich attacks,” manipulating the process of adding transactions to the Ethereum blockchain (MEV – Maximal Extractable Value-boost) to “poison” blocks, allowing them to see and profit from other users’ trades, stealing millions in Ethereum. The case represents a groundbreaking attempt to apply traditional fraud laws to sophisticated crypto transactions that many industry participants consider part of standard trading practices.
The two brothers, Anton Peraire-Bueno, 25, and James Peraire-Bueno, 29, went to trial in October 2025 and the trial was declared a mistrial. At the trial, one news source summarized their argument: “There was no fraud at all. All they did was outsmart some “predatory” automated trading bots. In the dog-eat-dog Wild West of crypto trading, it was fair game, not fraud.” The brothers anxiously await a decision as to whether Prosecutors will re-try the case or not…
Here is more background on the case:
Understanding the Alleged Scheme
According to the government’s indictment, the brothers exploited a vulnerability in open-source software used by Ethereum validators known as MEV-Boost. Prosecutors allege that on April 2, 2023, they submitted specially crafted “lure transactions” to draw competing automated MEV trading bots (called “searchers”), then used a false digital signature to cause a relay to release full block contents early. Once visible, prosecutors say they reordered transactions in a way that prevented bots’ planned sandwich trades from succeeding, leaving other traders with losses and enabling the defendants to capture roughly $25 million.
The Prosecution’s Theory
The government characterizes the brothers’ conduct as deceptive and fraudulent — asserting that they manipulated the blockchain protocol to mislead other network participants, including automated programs, and thereby obtained cryptocurrency through wrongful means. Prosecutors claim this conduct undermines the integrity of the Ethereum network and warrants charges under centuries-old statutes designed to combat deception and property-based fraud.
Broader Context in Crypto Enforcement
Because MEV itself refers to a theoretical max and is incredibly esoteric to someone not heavily entrenched in the crypto world, the boundaries between aggressive but lawful participation and alleged fraud are murky. The industry routinely discusses MEV and related tactics as part of normal economic incentives within decentralized systems. This case tests whether traditional fraud statutes can reach complex algorithmic behavior that was not previously the subject of enforcement actions – i.e., is there going to be a broader way to “enforce” the practices in this wild west of crypto trading?
Legal Uncertainty and Due Process
A key defense concern is that retroactively criminalizing conduct widely considered permissible—without clear regulatory or judicial precedent—raises serious due process concerns. (This is where us lawyers can lean into the old “notice and hearing” due process requirements that we LOVE!). The motion to dismiss filed by defendants underscores that fair notice and clarity in criminal statutes are foundational to constitutional protections, and punishing code-level interactions without a coherent standard jeopardizes those principles.
Why This Case Matters
Whether this prosecution proceeds or the indictment will ultimately be dismissed, the Peraire-Bueno case will shape how courts evaluate fraud claims in technology-driven markets. The outcome may influence everything from decentralized finance enforcement strategies to how future blockchain innovations are regulated and litigated in federal court – and what enforcement actions are to come.
At this stage, with a mistrial declared, we will have to watch and see whether the prosecution decides to refile.
How We Can Help
At HJP Legal, we understand that criminal defense in the modern era often requires deep engagement with cutting-edge technologies and complex legal theories. With offices and active representation in Michigan, Florida, and California, we provide defense strategies for clients facing fraud charges.
If you or a loved one are confronting allegations involving fraud, contact HJP Legal for a free, confidential consultation. We are committed to protecting your rights, your reputation, and your future.
