Steven Nerayoff, a pioneering advisor to the Ethereum network, has announced plans to sue the U.S. government for a staggering $9.6 billion. This legal action stems from 2019 criminal extortion charges against him, which were later retracted. Nerayoff’s legal team asserts that the charges were unfounded and alleges a setup by federal authorities aiming to coerce him into providing information on notable individuals in the cryptocurrency sector.
A Legal Battle Looms
The initiation of Nerayoff’s lawsuit follows the submission of a Federal Tort Claims Act (FTCA) form, signaling his intention to pursue legal action against the Department of Justice (DOJ). This procedural step is necessary at least six months before formally filing a lawsuit. In a significant move, Nerayoff has enlisted the expertise of Alan Dershowitz, a prominent civil liberties attorney, to consult on constitutional issues within the case.
Charges Dropped Amid Controversy
In May 2023, the U.S. government dropped all charges against Nerayoff, following an earlier decision by prosecutors to dismiss the case due to the emergence of crucial exculpatory evidence and their admission of an inability to substantiate the charges beyond a reasonable doubt. This turn of events came after Nerayoff’s defense unveiled a motion filled with serious accusations against the federal investigators and prosecutors involved.
Claims of an Elaborate Setup
Nerayoff alleges that the Federal Bureau of Investigation (FBI) orchestrated an elaborate setup spanning years, aimed at pressuring him into disclosing information on key figures in the cryptocurrency industry. He recounts a harrowing arrest by FBI agents in 2019, during which he was threatened and coerced into cooperating.
Dispute Over Government Informant
Further complicating the narrative, Nerayoff’s legal team disputes claims surrounding Michael Hlady, Nerayoff’s former co-defendant, suggesting that Hlady was planted by the FBI to aid in constructing a case against Nerayoff. Hlady, previously convicted of a separate fraud, pleaded guilty to the extortion charges linked to Nerayoff in 2021 but recently had those charges dismissed in favor of a plea for a lesser crime.
As this legal drama unfolds, it highlights the complexities and controversies at the intersection of law enforcement and the burgeoning cryptocurrency industry. Steven Nerayoff’s forthcoming lawsuit against the U.S. government represents not only a personal quest for vindication but also a critical moment for legal precedence in the crypto space.
