Amir Elmaani, the 31-year-old mastermind behind the now-defunct cryptocurrency scheme known as Oyster Protocol, has received the harshest penalty of a four-year prison sentence for his involvement in a massive tax evasion scheme. The United States Attorney’s Office announced on October 31st that Elmaani, who also operated under the alias “Bruno Block,” was handed this significant punishment following his guilty plea on April 6, where he confessed to clandestinely creating and selling Pearl tokens while evading income tax obligations on substantial profits generated through the project.
Elmaani’s admission revealed that his actions led to tax losses exceeding $5.5 million, a transgression taken seriously by the authorities. U.S. District Attorney Damian Williams commented on the sentencing, stating, “Amir Elmaani violated the duty he owed to pay taxes on millions of dollars of cryptocurrency profits, and he also violated the trust of investors in the cryptocurrency he founded.”
The Oyster Protocol, launched in 2017, was presented as a revolutionary blockchain-based data storage platform, with its native cryptocurrency, Pearl (PRL), marketed as an investment opportunity. However, unbeknownst to the project’s team and investors, Elmaani covertly created a vast quantity of PRL tokens and dumped them on the market in October 2018 for his personal enrichment.
In his plea agreement, Elmaani acknowledged, “I was aware that the counterparties who were buying these newly-minted PRL likely were not aware of my reopening of the smart contract and did not know that I had just substantially increased the total supply of PRL.” Despite reaping millions from this scheme, he falsely reported only earning $15,000 from a patent design business in his 2017 tax return and claimed zero income for 2018.
The court discovered that in 2018, Elmaani spent exorbitant amounts on multiple yachts, a carbon-fiber composite company, home improvements, and two homes. To further evade taxes, one home was purchased through a shell company, and the other was registered under the names of two of Elmaani’s associates. He also engaged in substantial transactions involving precious metals and stored gold bars in a safe on one of his yachts.
Prosecutors revealed, “In truth, Elmaani did not report or pay tax on any of his cryptocurrency proceeds. At various points, Elmaani used friends and family as nominees to receive cryptocurrency proceeds and transfer them or U.S. currency to his own accounts.”
In addition to the four-year prison sentence, Elmaani has been ordered to serve one year of supervised release and pay restitution of $5.5 million to cover the tax losses incurred as a result of his illicit actions. This case serves as a reminder that cryptocurrency-related financial misconduct will not go unpunished, as tax authorities continue to crack down on evasion within the digital asset space.
