Steven Nerayoff, an early advisor to the Ethereum network, has come out with serious allegations against the U.S. government’s law enforcement and regulatory agencies. His comments came in response to Senator Elisabeth Warren’s recent post on X about Binance, revealing what he calls systemic corruption within these agencies.
Senator Warren’s post drew attention to Binance CEO Changpeng Zhao’s guilty plea to anti-money laundering violations and described it as part of a broader criminal trend in the cryptocurrency space. She urged the Justice Department to investigate Binance’s alleged deception of Congress. The tweet emphasized the need for strict regulation, inadvertently laying the groundwork for Nerayoff’s revelations.
Ethereum Insider Insights on SEC Corruption
In a fiery response to Senator Warren, Nerayoff didn’t mince words. “Fighting systemic corruption everywhere: Senator Warren, I’m an advocate for strong cryptocurrency regulation in the United States. Go after the bad guys in our space. But the DOJ, SEC, and FBI prosecuted me for 3.5 years for a crime they fabricated,” he declared, opening up about his ordeal with the agencies.
Furthermore, he claimed, “I was targeted because I knew about corruption at the top of the SEC. The government pressured me to report other crypto players, whether they were guilty or not, but I refused to even accept that.” The charges stem from a highly controversial legal battle. Nerayoff was initially accused of extorting a Seattle-based cryptocurrency startup during its 2017 ICO along with his employees.
However, in a surprising turn of events, a New York judge dismissed the criminal racketeering charges against him in May 2023, ending a protracted three-and-a-half-year legal battle. The dismissal came after federal prosecutors acknowledged that they had obtained exculpatory evidence and admitted that they could not prove the charges beyond a reasonable doubt.
Nerayoff’s defense paints a picture of a man who was targeted for insider knowledge. According to his legal team, he was pressured to provide information on various players in the cryptocurrency industry, a request he has consistently resisted.
The defense claimed that the charges were trumped up and part of a grand scheme by the FBI, DOJ, and SEC to exploit his industry connections. Nerayoff asserted that “my case was dismissed after it was proven that the FBI, DOJ, and SEC conspired to fabricate the crimes for which I was indicted,” suggesting deep-seated corruption within those agencies.
Nerayoff collects information through FOIA
This narrative of systemic corruption took a darker turn with Nerayoff’s recent disclosure of receiving a letter from the SEC in response to his Freedom of Information Act request, in which the SEC acknowledged the discovery of more than 14 GB of data relevant to his case, a stark contradiction to their previous position of non-involvement.
That revelation, along with the SEC’s delayed response to his requests for documents, further fueled his allegations of wrongdoing. He expressed skepticism and cynicism about the SEC’s timeline for reviewing the documents, suggesting it was a deliberate attempt to obfuscate.
Notably, Nerayoff is currently preparing fraud charges against Ethereum founders Vitalik Buterin and Joseph Lubin after releasing a 2015 recording between him and Buterin that showed Nerayoff’s deep involvement in Ethereum.
