Director Robert Miś was engaged by the US Department of Justice (DOJ) as its cryptocurrency-mining and blockchain technology expert in a landmark prosecution involving a $577 million cryptocurrency fraud scheme, described as the largest fraud ever prosecuted in the Western District of Washington.  

Mr. Miś, now a Director at Secretariat,¹ provided a comprehensive expert report and forensic analysis, supported by quantitative exhibits and visual timelines. His analyses played a key role in establishing the strength of the case and scale of the fraud. Ultimately, the defendant decided to plead guilty.  

Case Background 

In United States v. Potapenko and Turõgin (No. CR22-185 RSL, W.D. Wash.), the DOJ alleged that defendants Sergei Potapenko and Ivan Turõgin, both Estonian nationals, defrauded hundreds of thousands of investors worldwide of more than $577 million between 2013 and 2019.  

The defendants’ flagship enterprise, HashFlare, claimed to offer customers cloud-based cryptocurrency mining contracts. Customers were told they were buying access to HashFlare’s large mining farms and would receive returns based on their purchased computing power (“hashrate”). In reality, HashFlare operated only a token number of mining machines (approximately 164 functioning units), far short of the estimated 80,000 to perform the promised operations. The DOJ claimed that Potapenko and Turõgin falsified nearly all of the mining data displayed to investors, alleging that the company’s “profits” were largely fictitious. Furthermore, they alleged that early investors were compensated with funds from later ones, constituting a classic Ponzi scheme.  

The defendants also raised $25 million through another enterprise, Polybius ICO, claiming they would create a fully digital bank. Instead, they diverted investor funds to personal and affiliated accounts, purchased luxury real estate, cars, and jewelry, and used shell companies to disguise money flows.  

Both men were extradited from Estonia and pleaded guilty to one count of conspiracy to commit wire fraud, admitting to misleading over 440,000 customer accounts. The United States recommended a 10-year prison sentence for each and forfeiture of more than $400 million in assets, much of which was traceable to appreciated cryptocurrency holdings. 

Expert Analysis, Contribution, and Impact 

Mr. Miś’s technical report and analysis compared the defendants’ claimed hashrate sales to the hardware, energy, and infrastructure that would have been required to deliver those services.  

This assignment required deep, hands-on expertise of cryptocurrency mining systems, including the design, assembly, and optimization of CPU, GPU, FPGA, and ASIC mining equipment, and an understanding of their corresponding algorithms (SHA-256, Scrypt, X11, Ethash, Equihash). The analysis also required proficiency in hashrate computation, proof-of-work protocols, mining pool operations, and power-consumption modeling, in addition to the ability to reconcile blockchain-level data with corporate records, sales ledgers, and hardware specifications. 

Key findings included: 

• HashFlare would have needed approximately 80,000 Bitfury B8 ASIC miners to fulfill its contracts, representing an equipment investment of nearly $500 million. Internal records showed actual equipment purchases under $1.6 million. 
• At its claimed capacity, HashFlare’s hashrate would have equaled 20 percent of the entire global Bitcoin network, exceeding even the world’s largest identifiable mining pools. 
• Operating such capacity would have required over 500 megawatts of electrical power, half of Estonia’s national consumption, rendering the defendants’ representations physically impossible. 
• Across non-Bitcoin algorithms (Scrypt, X11, Ethash, Equihash), the defendants similarly overstated capacity, misrepresented performance metrics, and in some cases marketed units incapable of efficiently mining the coins advertised. 

Mr. Miś’s analyses were cited by prosecutors to establish the technical impossibility and scale of the fraud, dispelling the defense’s characterization of HashFlare as merely a failed business. 

Ultimately, the defendants chose to plead guilty, acknowledging the magnitude of their deception. Mr. Miś’s expert evidence quantifying the implausibility of their claimed mining operations was central in reinforcing the government’s position and contributing materially to the case’s successful resolution. 

1. As of February 2025