If you graduate from the Massachusetts Institute of Technology with elite computer skills, you can make great money working for a tech company—or even more money working on Wall Street. But if that doesn't grab you, and you want to get even richer, you can always try your hand at white-collar crime like twentysomething brothers Anton and James Peraire-Bueno. The pair came up with a scheme that let them pocket $25 million in just 12 seconds. Unfortunately, it ended badly, as the feds announced yesterday in a press release that reads like a pulp novel.

"Unfortunately for the defendants, their alleged crimes were no match for Department of Justice prosecutors and IRS agents," wrote the DOJ. For good measure, the release quotes an agent who declares the crime was solved "with cutting-edge technology and good-ole-fashioned investigative work."

Purple prose aside, the case involves some impressive detective work as well as a sophisticated explanation by Justice Department lawyers of a new type of alleged crime involving the Ethereum blockchain. The crime involves the arcane business of "Maximum Extractable Value," or MEV, which entails packaging transactions in a block in a way that allows those who construct the blockchain to profit from others' transactions.

The miners who build blockchains do not, of course, do this out of the goodness of their hearts. Instead, the process relies on incentives that allow miners—in the case of Bitcoin, Ethereum, and other chains—to obtain a reward in the form of both coins and transaction fees for adding a new block. When Ethereum switched to a new blockchain construction process known as proof-of-stake, however, it created new opportunities for miners to make money—including by front-running trades included in the blocks they package. This is what people mean by MEV. (Bitcoin investment firm River, as well as the DOJ's criminal indictment, has a good explanation of how exactly it works).

MEV has been around for a while now, and while a number of people in crypto find it distasteful, it is not illegal—and indeed, similar things go on in the world of traditional finance such as the practice known as payment for order flow. The Peraire-Bueno brothers, however, took things a step further when they detected a bug in a popular piece of software used to carry out MEV. This allowed them not to simply front-run Ethereum users' transactions, but to tamper with them in a way that allowed them to outright rob them.

All of this is likely to draw new scrutiny of the murky practice of MEV, and potentially lead to calls for reform among the Ethereum crowd. As for the Peraire-Bueno, the episode also showed that people with MIT degrees are also capable of old-fashioned stupidity. Not only did they get caught, but the DOJ also found evidence they conducted web searches about things like money laundering and how to get away with financial fraud. Don't Google your crimes, people! Finally, the brothers can at least take comfort that they are not only the MIT grads to be charged with crypto crimes—the school is also the alma mater of a certain Sam Bankman-Fried.

Jeff John Roberts
[email protected]
@jeffjohnroberts

This story was originally featured on Fortune.com