Two MIT students will face trial for exploiting the Ethereum blockchain to steal $25 million using MEV (maximal extractable value) bot manipulation, after a judge denied their motion to dismiss fraud charges. The accused Anton and James Peraire-Bueno, who are also siblings, were told by US District Judge Jessica Clarke that the government had sufficiently alleged fraudulent conduct under federal law. In a ruling issued on Wednesday, Judge Clarke said the wire fraud statute gave the defendants adequate notice that their actions could be deemed criminal, even if the method was novel. As such, the court is required to accept the government’s allegations as true at this stage. Federal prosecutors charged the brothers in May 2024, accusing them of devising a sophisticated scheme to manipulate the Ethereum network. The charges include wire fraud, conspiracy to commit wire fraud, and conspiracy to commit money laundering. According to the indictment, the brothers used a four-step plan—“bait, block, search, and propagation”—to trick MEV bots into engaging with their lure transactions. They then allegedly interfered with the block validation process using their own Ethereum validators to capture the bots’ profits. What are MEV bots? MEV bots, short for maximal extractable value bots, are automated programs that search blockchain transaction queues to extract profits. They often target opportunities where they can front-run or sandwich a user’s transaction, typically to benefit from arbitrage or manipulate prices. These bots are particularly active in decentralised finance ecosystems, where liquidity and transaction speed can be exploited. MEV strategies are designed to profit from the public nature of pending blockchain transactions, often by inserting their own transactions before and after those of unsuspecting users. Such practices can result in heavy financial losses for traders. One common attack, known as a sandwich attack, involves placing a buy order before and a sell order after a victim’s trade, distorting the price to the attacker’s advantage. In March 2025, a crypto trader lost more than $215,000 during a stablecoin transfer due to an MEV sandwich attack on Uniswap v3. The attacker drained liquidity before the transaction and paid $200,000 in bribes to a block builder to ensure execution. In another instance, an MEV bot known as “arsc” accumulated nearly $30 million on the Solana blockchain through sandwich attacks, operating across multiple wallets to remain undetected. According to analysts involved in the investigation, the bot was smart enough to use cold storage and gradually swapped tokens to avoid scrutiny. How to prevent MEV attacks? To counteract such attacks, some crypto platforms have developed protective measures . For instance, Bitget Wallet introduced default MEV protection across Ethereum, Solana, BNB Chain, and others. MEV bots typically manipulate liquidity pools to distort crypto asset prices, often misleading traders with false market signals. Bitget Wallet says its system prevents such distortions, helping users access accurate and fair pricing. Its infrastructure now integrates MEV safeguards directly into its swap feature, helping ensure fair pricing and gas estimation for users. The company has stressed that protecting users against evolving MEV threats is critical for preserving trust in decentralised trading. Defendants say they were operating legally Returning to the current case, the Peraire-Bueno brothers argued that their actions were permissible under Ethereum’s open-source code. Further, they have claimed that their victims, which are reportedly automated MEV bots, engaged in similar manipulative practices and were not entitled to legal protection. Additionally, the defense successfully had one charge, conspiracy to receive stolen property, dropped after citing a Department of Justice memo warning against regulatory overreach in the digital asset space. For now, Judge Clarke’s decision to deny dismissal has cleared the path for trial, which has been scheduled for October 2025. While the date was not confirmed in the ruling, pre-trial motions are ongoing and the case remains active. If convicted, the brothers could face significant prison time and financial penalties under federal wire fraud and money laundering statutes. The post Two MIT students to stand trial for $25M Ethereum MEV exploit scheme appeared first on Invezz
