MEV Boost “Fraud” Case Ends In Mistrial As Jury Fail To Reach Verdict

A US court judge has declared a mistrial in the case against two brothers for allegedly exploiting the Ethereum (ETH) MEV-boost system to net a $25 million profit.

A 12-Second Historic MEV Boost ‘Heist’

In May 2024, the US Department of Justice announced an indictment against Anton and James Pepaire-Bueno, accusing the two MIT-trained brothers of a conspiracy to commit wire fraud and money laundering. 

According to the DOJ, the Pepaire-Bueno siblings stole $25 million in ETH in a first-of-its-kind heist targeting the prominent blockchain network. Notably, the brothers had explored a flaw in the Ethereum MEV Boost system, allowing them to view hidden pending transactions:

Acting as a block builder, they “poisoned” a block to trick trading bots into revealing their strategies, then executed a sandwich attack, buying a large volume of ETH before another trader’s order and selling immediately after the price rose. 

This attack was targeted at a trio of cryptocurrency traders, allowing them to net a profit of $25 million in just 12 seconds. According to a report by Business Insider, in the case presented to the US District Judge Jessica Clarke for the Southern District of New York, the prosecutors likened the crypto trade hustle to a common fraud.

Assistant US District Danielle Marie Kudla stated that creating a poison block was an act of deceit against other traders that should be punished by law.  However, the lawyers of the defendants countered this narrative, stating the Pepaire-Bueno brothers had not operated beyond the bounds of trading in a bot-eat-bot world of Ethereum.

Jury Fails To Convict Or Acquit ‘MEV Brothers’

On Friday, November 7, the jury in the case struggled to reach a unanimous verdict, according to Business Insider. The 12-man team. stated the peculiar case that had undergone a four-week trial had resulted in significant personal emotional cost. 

Notably, some jurors had broken down into tears during deliberations, while others complained of sleeplessness over the three days of deliberation. Moreover, one juror was scheduled to travel on Saturday, according to the Inner City Press.

Following the motion for a mistrial, the prosecutors were willing to move the case to Monday and continue with 11 jurors. However, Judge Clarke opted to declare a mistrial as she strongly believed an extension would solve the jury’s confusion. While this ruling might provide some relief for the Pepaire-Bueno brothers, it’s worth noting that the charges remain active and prosecutors can still move for another trial.

Featured image from Protos, chart from Tradingview