US Targets Ethereum DeFi MEV Case Again as Prosecutors Fight Industry Input

Core Insights - US prosecutors are preparing for a retrial of two brothers accused of a $25 million MEV exploit, which adds regulatory pressure on Ethereum and DeFi [1][3] - The case raises questions about the legality of certain on-chain strategies versus criminal exploitation [2][4] - The DeFi Education Fund argues that aggressive prosecutions could deter developers and push innovation offshore, potentially harming the DeFi ecosystem [5] Group 1: Case Background - The brothers, Anton and James Peraire-Bueno, allegedly used automated MEV bots to extract approximately $25 million from Ethereum transactions [2] - A previous jury could not reach a consensus on the legality of the brothers' actions, leading to a mistrial declared in November 2024 [3] - Prosecutors are now seeking to retry the case in early 2026 and are contesting the influence of external policy groups like the DeFi Education Fund [3][4] Group 2: Implications for the Industry - The DeFi Education Fund warns that the prosecution's approach could scare developers away from building on Ethereum, leading to fewer applications and increased market concentration among larger players [5] - Regulators express concern that inaction could lead to a chaotic environment where insiders exploit new users through practices like front-running [6] - If courts classify certain MEV strategies as fraud, it may mitigate some of the more egregious abuses in the market [6]