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A representation of the digital currency Ethereum.
CNN
—
Two brothers who studied at the Massachusetts Institute of Technology were arrested in the United States on Wednesday on charges of executing a cutting-edge plot to exploit the integrity of the Ethereum blockchain to steal $25 million worth of cryptocurrency.
Federal prosecutors in Manhattan called the scheme run by Anton Perere Bueno, 24, and James Perere Bueno, 28, “unprecedented” and said it was the first time such a fraud had been the subject of criminal charges in the United States.
Authorities say the perpetrators carried out an elaborate heist in April 2023, compromising pending transactions and altering the movement of cryptocurrency, stealing $25 million from traders in just 12 seconds.
“As we allege, the defendants' scheme calls into question the very integrity of the blockchain,” US Attorney Damien Williams said.
The indictment charges the two men with wire fraud conspiracy, wire fraud and money laundering conspiracy. Anton Pereire Bueno was arrested in Boston, and James Pereire Bueno was arrested in New York.
Their lawyers did not immediately respond to requests for comment.
Both brothers attended MIT in Cambridge, Massachusetts, where prosecutors say they studied computer science and mathematics, giving them the skills and education to carry out the fraud.
According to the indictment, the Peraire-Bueno brothers conspired for several months to manipulate and tamper with the protocols used to verify transactions recorded on the Ethereum blockchain, a public ledger that records each cryptocurrency transaction.
Prosecutors said the attack exploited a vulnerability in the code of software called MEV Boost, used by most of the Ethereum network's “validators,” whose role is to check the validity of new transactions before they are added to the blockchain.
Prosecutors said the brothers refused requests to return the funds after carrying out the robbery and instead took steps to launder and conceal the stolen cryptocurrency.
