Initially the Department of Justice had characterized the case as a $577 million fraud matter, calling it one of the largest crypto fraud cases ever — but the Reed Smith team proved those claims were incorrect.

Following Mr. Potapenko’s extradition from Estonia, the firm obtained his release from custody and removed incorrect allegations from the indictment through a negotiated plea agreement. The team presented extensive briefing showing that Mr. Potapenko and his co-defendant Ivan Turogin had paid customers the correct rate of return for crypto mining, that the crypto customers received has a current value of more than $5 billion, and that their forfeiture of over $500 million and cooperation had eliminated any financial harm to HashFlare’s customers.

The Reed Smith team included Mark Bini, Ed Mullins, Kaela Dahan, Victoria Jaus, Rob Carnes, and Natalia Terezakis.

Bini, a New York based partner and former federal and state prosecutor, commented: “We are pleased with Judge Lasnik’s thoughtful sentence. It was well deserved. We raised serious issues about loss, and the Court recognized the tremendous cooperation by Sergei and his partner Ivan Turogin to forfeit $500 million and provide DOJ with a customer database to facilitate full remission to all customers.”