US indicts Ethereum validators for exploiting MEV trader
Anton Peraire-Bueno and James Peraire-Bueno, two brothers who operate Ethereum validators, have been indicted in the Southern District of New York on charges of wire fraud, conspiracy to commit wire fraud, and conspiracy to commit money laundering. The charges related to a scheme that has been described as exploiting the ‘very integrity of the Ethereum Blockchain to fraudulently obtain approximately $25 million.’ The brothers allegedly worked together on a complex exploit that allowed them to take advantage of traders searching for ‘maximum extractable value’ (MEV) on Ethereum. By operating multiple Ethereum validators, the brothers were allegedly able to submit blocks that included exploited transactions . Allegedly, once the brothers were aware that their validators would soon have opportunities to submit blocks, they would create ‘bait’ transactions that seemed to have significant upside for the MEV traders and wait for those traders to attem...