Steven Nerayoff, an early adviser to the Ethereum network, has come forward with grave accusations against the US government’s law enforcement and regulatory agencies. His statements, made in response to a recent post on X by Senator Elisabeth Warren’s about Binance, shed light on what he describes as systemic corruption within these agencies.
Senator Warren’s post drew attention to the guilty plea of Binance CEO Changpeng Zhao on breaking anti-money laundering laws, portraying it as part of a wider trend of criminality in the crypto space. She urged the DOJ to probe Binance for alleged deceit towards Congress. This tweet, highlighting the need for stringent regulatory oversight, inadvertently set the stage for Nerayoff’s revelations.
Ethereum Insider Targeted For SEC Corruption Insights
In a charged response to Senator Warren, Nerayoff didn’t mince words. “BATTLING SYSTEMIC CORRUPTION EVERYWHERE: Senator Warren, I advocate for strong US crypto regulations. PLEASE go after the bad actors in our space. But the DOJ, SEC, & FBI prosecuted me for 3 1/2 years for a crime THEY fabricated,” he declared, opening up about his own ordeal with these agencies.
Further, he claimed, “I was targeted due to my knowledge of high-level SEC corruption. The government pressured me to inform on other crypto players, regardless of their guilt, which I refused to even entertain.” These allegations stem from a deeply controversial legal battle. Nerayoff was initially accused, along with his employee, of extorting a Seattle-based cryptocurrency startup during its ICO in 2017.
However, in a stunning turn of events, a New York judge dismissed the criminal extortion charges against him in May 2023, bringing an end to a protracted three-and-a-half-year legal battle. This dismissal came after federal prosecutors admitted to having acquired exculpatory evidence and acknowledged their inability to prove the charges beyond a reasonable doubt.
Nerayoff’s defense painted a picture of a man targeted for his insider knowledge. According to his legal team, he was coerced into providing information on various players in the crypto industry, a demand he consistently refused.
The defense alleged that the charges were a fabrication, part of a grand scheme by the FBI, DOJ, and SEC to leverage his industry connections. “My case was dismissed after proving the FBI, DOJ & SEC colluded to fabricate the crime for which I was being prosecuted,” Nerayoff asserted, indicating a deep-seated rot within these institutions.
Nerayoff Gathers Info Through FOIA
This claim of systemic corruption takes an even darker turn with Nerayoff’s most recent revelation about receiving a letter from the SEC for his FOIA request. In it, the SEC admits to discovering over 14 gigabytes of data pertinent to his case, a stark contradiction to their earlier stance of non-involvement.
This discovery, and the SEC’s delayed response to his request for documentation, further fueled his allegations of misconduct. He expressed disbelief and sarcasm at the SEC’s timeline for reviewing these documents, suggesting a deliberate attempt at obfuscation.
Remarkably, Nerayoff is currently preparing his fraud charges against Ethereum founder Vitalik Buterin and Joseph Lubin after releasing a 2015 recording between him and Buterin. The recording shows Nerayoff’s deep involvement with Ethereum.
At press time, ETH traded at $2,061.