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Federal prosecutors in the United States have pushed back against attempts to introduce cryptocurrency policy arguments in the high-profile MEV bot trial, where two brothers stand accused of exploiting Ethereum trading bots to steal $25 million.
According to filings from the US District Court for the Southern District of New York, prosecutors urged Judge Jessica Clarke to reject an amicus curiae brief submitted by a crypto advocacy group seeking to weigh in on the case. The MEV bot trial centers on allegations that the brothers manipulated blockchain transactions in a matter of seconds, taking advantage of the Ethereum network’s order system.
The proposed amicus brief, reportedly from Washington-based Coin Center, challenges the government’s “honest validator theory,” arguing that it could criminalize normal blockchain behavior. However, prosecutors say the submission risks biasing the jury and introducing irrelevant crypto policy discussions.
“A brief directed at policy arguments regarding the role of validators in the industry is not relevant to the governing legal standard,” prosecutors wrote in their letter to Judge Clarke.
They added that questions about crypto regulation and validator conduct “belong before Congress, not a jury.”
The Department of Justice previously indicted Anton Peraire-Bueno, 24, and James Peraire-Bueno, 28, in May 2024. Both are sons of Jaime Peraire, the former head of MIT’s Department of Aeronautics and Astronautics.
In their filings, prosecutors in the MEV bot trial argue that the defendants knowingly exploited a vulnerability in automated trading bots on Ethereum, manipulating transaction sequencing to extract $25 million in just 12 seconds.
This practice, known as maximal extractable value (MEV), allows validators or traders to reorder transactions within a block for personal profit. While the mechanism is technically permissible within blockchain systems, the government contends that the Peraire-Bueno brothers’ actions crossed into criminal fraud.
The prosecution maintains that the MEV bot trial should focus strictly on the legality of the conduct, not on broader blockchain philosophy. They emphasized that any attempts to use crypto policy as a defense would distract from the central fraud charges.
“The proposed submission is inappropriate, unhelpful to the Court, and an invitation for nullification,” prosecutors told the judge.
Their position underscores a growing tension between crypto innovation and legal accountability — a recurring theme in recent digital asset prosecutions.
Defense attorneys Daniel Nathan Marx and William Fick dispute the prosecution’s interpretation, calling it a “stunning new theory of fraud.” They argue that under the government’s “honest validator theory,” any blockchain participant acting competitively could face criminal liability for actions within the network’s design.
In their argument during the MEV bot trial, they referenced the United States v. Finnerty (2008) precedent, which limited how non-traditional financial behavior can be criminalized under existing fraud statutes.
“The government’s blind opposition to the submission falls within the Court’s wide discretion to allow, consider, and give whatever weight it deems appropriate,” Marx and Fick stated.
The defense further insisted that Coin Center’s expertise is critical for understanding how the case could reshape blockchain participation norms. They maintain that the brief is intended to clarify implications for decentralized systems, not to sway jurors.
According to sources, defense counsel also argued that Ethereum’s decentralized nature contradicts the government’s fraud theory. They said the network operates through independent economic incentives, not contractual promises — meaning no “promise to the victim” exists to justify fraud charges.
“The Ethereum network functions through independent actors following incentive structures, not contractual obligations,” the defense stated.
The defense in the MEV bot trial also sought to restrict testimony from Bert Miller, a researcher at Flashbots, a developer active in the MEV ecosystem. They argued his testimony should remain purely technical, excluding opinions about “rules” or “expectations” for honest validators, which they deemed subjective.
If Judge Clarke rules in favor of the prosecution, the case could set a precedent for how U.S. courts interpret blockchain manipulation and MEV practices. Conversely, if the defense prevails, it could narrow the government’s ability to apply fraud statutes to blockchain behavior that exploits system mechanics but lacks explicit deception.
For crypto investors and policymakers, the outcome of the MEV bot trial will shape how innovation and regulation intersect in decentralized systems. The case raises fundamental questions about the line between technical opportunism and criminal fraud in digital finance.
