Insider Testifies MIT Brothers Allegedly Planned $25M Crypto Heist for Months
The post Insider Testifies MIT Brothers Allegedly Planned $25M Crypto Heist for Months appeared on BitcoinEthereumNews.com.
In brief Travis Chen, a quantitative trader who worked for the brothers’ company, testified about a December 2022 meeting where they outlined the alleged scheme. Chen agreed to forfeit $2.4 million, his cut from the operation, under a nonprosecution agreement with the government. Notes from the planning meeting showed the brothers reportedly anticipated making $6 million or potentially “way higher” if they could “trap them all at once.” Two MIT-educated brothers allegedly planned for months to exploit a software vulnerability and steal $25 million from crypto traders in just 12 seconds, a former employee testified Friday in Manhattan federal court. Travis Chen, a quantitative trader and former employee of Anton and James Peraire-Bueno’s firm 18decimal, testified that during a December 2022 meeting, the brothers allegedly outlined a plan to manipulate Ethereum’s MEV-Boost protocol in an operation they referred to as “Omakase.” “It was an operation that profited at the expense of sandwich bots,” Chen testified under a nonprosecution agreement that required him to forfeit $2.4 million, his cut from the alleged heist, according to a Law360 report. Sandwich bots are automated trading programs that exploit price movements by inserting their own transactions before and after a pending trade, “sandwiching” it, to profit from the resulting price slippage. In this case, the operation targeted those bots, turning their usual strategy against them. The brothers face wire fraud and money laundering conspiracy charges carrying up to 20 years each for the 12-second heist, and went on trial last Tuesday after rejecting a plea deal. Prosecutors allege the brothers became validators on Ethereum’s blockchain and exploited a glitch that let them view transaction data early, then restructured blocks to benefit themselves at the expense of “sandwich traders.” Chen showed jurors notes from a December 2022 meeting outlining the plan’s scale, which read,…
