Two Brothers attack Ethereum blockchain, steal $25 million in cryptocurrency 

Two brothers, Anton Peraire-Bueno of Boston and James Peraire-Bueno of New York, were arrested yesterday in connection with a massive heist on the Ethereum blockchain which led to the loss of $25 million worth of crypto assets.

The two brothers were arrested and charged with conspiracy to commit wire fraud and conspiracy to commit money laundering.

According to a post by the US Department of Justice’s Office of Public Affairs, Anton, 24, and James, 28, were arrested on Wednesday in Boston and New York, respectively, and will be presented this afternoon before U.S. Magistrate Judge Paul G. Levenson for the District of Massachusetts and U.S. Magistrate Judge Valerie Figueredo for the Southern District of New York.

“As alleged in today’s indictment, the Peraire-Bueno brothers stole $25 million in Ethereum cryptocurrency through a technologically sophisticated, cutting-edge scheme they plotted for months and executed in seconds,” said Deputy Attorney General Lisa Monaco.

“Unfortunately for the defendants, their alleged crimes were no match for Department of Justice prosecutors and IRS agents, who unraveled this first-of-its-kind wire fraud and money laundering scheme. As cryptocurrency markets continue to evolve, the Department will continue to root out fraud, support victims, and restore confidence to these markets.” Lisa added.

The US attorney for the Southern District of New York Damian Williams gave his account of the development from his end.

“Today, my office indicted two brothers — Anton Peraire-Bueno and James Peraire-Bueno — for conspiracy to commit wire fraud, wire fraud, and conspiracy to commit money laundering, all stemming from their alleged scheme to exploit the Ethereum blockchain and to obtain about $25 million worth of cryptocurrency from it,” said U.S. Attorney Damian Williams for the Southern District of New York.

“As we allege, the defendants’ scheme calls the very integrity of the blockchain into question. The brothers, who studied computer science and math at one of the most prestigious universities in the world, allegedly used their specialized skills and education to tamper with and manipulate the protocols relied upon by millions of Ethereum users across the globe. And once they put their plan into action, their heist only took 12 seconds to complete. This alleged scheme was novel and has never before been charged. But as the indictment makes clear, no matter how sophisticated the fraud or how new the techniques used to accomplish it, the career prosecutors of this office will be relentless in pursuing people who attack the integrity of all financial systems.” Williams added.

Special Agent in Charge Thomas Fattorusso of the Internal Revenue Service Criminal Investigation (IRS-CI) New York Field Office gave intricate details of the heist and the background of the two brothers involved.

“These brothers allegedly committed a first-of-its-kind manipulation of the Ethereum blockchain by fraudulently gaining access to pending transactions, altering the movement of the electronic currency, and ultimately stealing $25 million in cryptocurrency from their victims,” Special Agent Thomas said.

“In this case, IRS-CI New York’s Cyber Unit simply followed the money. Regardless of the complexity of the case, we continue to lead the effort in financial criminal investigations with cutting-edge technology and good-ole-fashioned investigative work, on and off the blockchain.” Agent Thomas added.

The two brothers who studied mathematics and computer science at Massachusetts Institute of Technology in the United States face up to 20 years jail term for each count if indicted.

IRS-CI New York’s Cyber Investigations Unit investigated the case, with the assistance of the U.S. Customs and Border Protection and the New York City Police Department.

What to know 

  • Ethereum blockchain is the second largest blockchain and the native ecosystem for Ethereum, the second largest cryptocurrency by market capitalization.
  • As of yesterday, Ethereum had 268.37 million cumulative unique addresses, which is a 16.14% increase from one year ago. It also has 512,566 daily active addresses, which is a 23.54% increase from one year ago. The number of transactions completed on the Ethereum network per day is 1.190 million, which is an 8.06% increase from one year ago.
  • Security and privacy remain a front-burner issue in the cryptocurrency industry as various cases of theft and fraud often scare off potential investors and users.



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