HomeCryptoEthereumThe Ethereum co-founder Steven Nerayoff against the United States Government

The Ethereum co-founder Steven Nerayoff against the United States Government

Steven Nerayoff, once a key advisor of the Ethereum network, has launched a bold legal challenge against the United States government, seeking damages of $9.6 billion for what he claims are unjust criminal extortion charges filed against him in 2019, only to be later withdrawn. 

In what unfolds as a legal thriller narrative, the case brings to light not only a personal battle for justice, but also deeper concerns about justice, the role of government agencies, and the vulnerability of individuals in the face of systemic power.

The $9.6 billion legal battle between former Ethereum advisor Steven Nerayoff and the United States Government

The legal team of Nerayoff has put forward the hypothesis that their client has been trapped by the FBI and federal prosecutors in a calculated attempt to force him to disclose information about prominent figures within the cryptocurrency industry. 

This statement, if proven, not only questions the ethics of investigative practices, but also highlights the precarious intersection between law enforcement and constitutional rights in the world of digital finance.

The genesis of the cause can be traced back to September 17, 2019, when Nerayoff was arrested in dramatic circumstances by FBI agents. The charges against him were serious, implicating him in criminal extortion. 

However, the narrative took a significant turn when, in May 2023, the United States government dropped all charges against him. This withdrawal followed a motion by the prosecutors acknowledging the discovery of material exculpatory evidence and admitting their inability to prove beyond a reasonable doubt the charges in the indictment.

This dramatic turn of events serves as the backdrop for Nerayoff’s current legal maneuver. Invoking the Federal Tort Claims Act (FTCA), he has signaled his intention to hold the Department of Justice (DOJ) accountable for what he describes as a case based on unfounded and fabricated charges concocted against him.

The FTCA serves as a mechanism through which individuals can sue the federal government for the wrongdoing committed by its officials, and Nerayoff’s request is particularly remarkable for its staggering demand of 9.6 billion dollars in damages.

The importance of chance and its potential ramifications

Adding a level of complexity and seriousness to the case is the engagement of Alan Dershowitz, a renowned civil liberties lawyer, who has joined Nerayoff’s legal team as a consultant on constitutional issues. Dershowitz’s involvement underscores the importance of the case and its potential ramifications on the interpretation and application of constitutional rights in the United States.

At the center of Nerayoff’s argument is the accusation that his legal troubles were the result of a complex FBI plot aimed at using him as a source of information against others in the cryptocurrency industry. If proven, this claim could expose serious ethical and legal violations in the conduct of federal investigations.

Furthermore, the narrative includes claims that Michael Hlady, a former co-defendant in the extortion charges and a convicted criminal, was placed in Nerayoff’s circle by the FBI as part of their strategy to build a case against him. If proven, these assertions could expose serious ethical and legal violations in the conduct of federal investigations.

The development of this case will undoubtedly be closely followed, not only for its direct impact on the individuals involved but also for its broader implications.

At stake are issues of power balance between the state and individuals, the integrity of the legal system, and the protection of civil liberties in a digital age that increasingly blurs the boundaries between private enterprise and public responsibility.


In conclusion, Steven Nerayoff’s legal battle against the United States government transcends his personal claim. 

It stands as a test of the robustness of constitutional protections against government power, particularly in innovative and unexplored sectors such as cryptocurrencies. 

As this case progresses, it will inevitably spark debates and discussions on the nature of justice, the ethics of law enforcement, and the ever-evolving relationship between technology and the law.