New York Times: Lawyer Kyle Roche and Ava Labs video storm, who is behind the scenes?

原文标题：《He Went After Crypto Companies. Then Someone Came After Him.》

Author: John Carreyrou

Original compilation: Qianwen, ChainCatcher

The praying mantis catches the cicada, and the oriole follows behind.

Kyle Roche was a rising star in the field of cryptocurrency law - until his career went awry, who orchestrated this rising star's downfall?

In a secretly recorded video, attorney Kyle Roche described his close relationship with his cryptocurrency clients.

1. Rising star

When Kyle Roche arrives in London at the end of January 2022, he will be making a name for himself. Although only 34 years old, he is already one of the veterans of the nascent cryptocurrency litigation field. He owns a law firm that bears his name and has filed lawsuits against more than a dozen cryptocurrency companies, including a case that resulted in a hefty judgment against Bitcoin's alleged founder.

Now new opportunities are beckoning to him.

The two businessmen arranged to fly Roche from Miami to discuss investing in a new commercial venture he was forming, and drove him to meet them at a luxury townhouse in Mayfair.

That night, Roche dined with one of the men, who identified himself as Villavicencio and was from Argentina, at one of London's most luxurious restaurants, the Jean-Georges at the Connaught Hotel.

Roche said he woke up the next morning feeling dizzy. He doesn't remember anything except that he was pretty sure he spotted Villavicencio's business partner, a Norwegian named Ager-Hanssen, lingering at a nearby table. This groggy feeling made him feel very wrong, because he didn't think he had drunk too much alcohol. When Roche flew back to Miami a few days later, he still couldn't shake the feeling that something was wrong.

A few months later, one day last summer, Roche's world began to unravel. A website called Crypto Leaks published more than two dozen videos he secretly recorded during meetings with Villavicencio and Ager-Hanssen.

The videos portray Roche and his law firm, Roche Freedman, as vehicles for making money from cryptocurrency clients. In one clip, Roche reveals that the client, a company called Ava Labs, offered him tens of millions of dollars worth of digital tokens, making him grateful for the company and its founder, who Compare yourself to your brother.

In other clips, Roche gives the impression that he only cares about advancing Ava Labs' interests, even when representing other clients. He boasted that he had successfully deflected regulators' investigation of Ava Labs and suggested that his lawsuits against other cryptocurrency companies were aimed at hurting Roche's competitors.

In the video, shot by Jean-Georges, Roche appears drunk, waving his hands, swearing and calling jurors idiots.

Beyond the initial shock, Roche realized he had a huge problem on his hands, and the videos made him look corrupt and immoral. In his own defence, he published an article on Medium saying the videos were obtained illegally and taken out of context, and he also denied any collusion with Ava Labs.

But it was too late. Company after company sued by Roche filed motions to disqualify the company from their cases. In October, the first of those motions succeeded: A federal judge in New York struck Roche Freedman out of his case against Tether, the operator of the world's most widely used stablecoin.

Within days, Roche was forced to resign from the law firm he founded. With his career imploded, he took ethics classes and started seeing a therapist, he said.

Roche is notorious for being outspoken and too close to customers. But at the same time he was also the victim of an international trap. Who is the murderer behind the scenes?

2. The new sheriff of the encrypted class

Roche grew up in Buffalo in a working-class family. He is the eldest of four siblings and shares a bedroom with his intellectually disabled twin brother. As a child, he felt guilty and determined to succeed so that he could support them one day while his siblings struggled to complete simple tasks while he was at ease in school.

After attending Purdue University and working as a management consultant for several years, he attended Northwestern University's Pritzker School of Law. During his first semester in fall 2013, he became fascinated with cryptocurrencies. According to his classmates, he was constantly checking the bitcoin price on his laptop during class. Roche cashed out before the price of the token plummeted, making a profit of about $100,000. He used the money to pay his tuition.

Roche, who was in third grade at the time, collaborated with a professor on a paper discussing the merits of bitcoin as the first currency free from government intervention, which was later reviewed in the Wall Street Journal.

"That was the first time it occurred to me that maybe I could do something with this," he said.

At the time, Roche was a first-year attorney at the law firm of Boies Schiller Flexner. At the time, he was emerging as a crypto teenager. When a colleague in Miami approached him about a bitcoin-related case a few days after the Times article was published — he jumped at the opportunity.

The case pits a man named Ira Kleiman against Craig Wright, an Australian computer scientist who claims to be Satoshi Nakamoto, the mysterious creator of Bitcoin. Kleiman is suing Wright for defrauding his brother David, a paraplegic computer forensics expert who died in his 40s, to benefit from the billions of dollars in bitcoin they mined together in the early days of bitcoin.

The whole thing is a fog: there is evidence that Wright and David were indeed friends, and it is understood that David always has an encrypted hard drive around his neck, which may contain the password to the bitcoin wallet. But many see Wright as a liar, questioning his claim to have mined early Bitcoin blocks, let alone defrauded others of their money.

For Roche, that's the appeal of the case. If he can get Dr. Wright to hand over his files during forensics, he may be able to solve Bitcoin's biggest mystery: the true identity of Satoshi Nakamoto. Roche and colleague Velvel Freedman quickly devoted most of their time to the case.

In 2019, as the Kleiman case moved toward trial, Roche had a new client who was embroiled in a dispute with a cryptocurrency company. In just a few days, he negotiated a lucrative settlement on behalf of his client. As a token of appreciation, the client agreed to invest $7.5 million in Roche and Freedman to start their own law firm. Roche initially ran the company from a co-working space in Brooklyn, then joined Freedman's team in Miami when the pandemic hit. Their company, Roche Freedman, quickly became a sensation.

At that time, a group of start-up companies took advantage of the east wind of Bitcoin and issued new coins one after another, pushing up the price of the currency, and finally causing the price to collapse. This reminded him of a very common stock market scam called "pump and dump". Gangs of scammers would publish various information online to drive up prices, and finally short-sell the stock before the price fell. Take all profits.

Regulators didn't appear to be doing anything, so Roche decided to take action on its own. On April 3, 2020, Roche Freedman filed a lawsuit seeking class-action status against seven digital currency issuers, alleging they used false claims to inflate the price of unregistered securities, which were then sold at the expense of retail investors.

It also sued four cryptocurrency exchanges for providing convenience to coin issuers, and also provided some legal arguments for the SEC to sue Binance and Coinbase.

The lawsuits were just the beginning: 16 months later, Roche filed the biggest securities fraud case of his career. The case accuses British entrepreneur Dominic Williams and entities he controls of defrauding investors of billions of dollars by aggressively promoting and selling a digital coin it claims will revolutionize computing.

Williams has boldly claimed that his Internet Computer Blockchain (a decentralized network of computers powered by a digital token called ICP) will replace the massive cloud services offered by Amazon and Microsoft as humanity's primary computing platform. ICP’s initial price surge, which catapulted it to become one of the most valuable cryptocurrencies in the cryptocurrency market, has since plummeted 92 percent — a collapse that Roche’s lawsuit attributes to a massive sell-off by Williams and other insiders. (Williams has denied the allegations).

If cryptocurrencies are the wild west of finance, Roche has declared himself the new sheriff. But, as he soon learns, where there's a sheriff, there's an enemy.

3. Huge judgment

Emin Gun Sirer runs Ava Labs, a cryptocurrency company that gave Roche an equity stake whose token was worth millions at its peak.

Around the time Roche was working on his first pump and dump lawsuit, he befriended Cornell computer science professor Emin Gun Sirer, who had incubated a cryptocurrency project of his own at the Brooklyn co-working space where Roche originally worked. Roche agreed to provide legal services to Dr. Sirer's company, Roche, in exchange for equity and a fraction of its planned cryptocurrency token offering.

This arrangement is not uncommon in the tech industry. Roche's former boss, David Boies, made a similar deal with Theranos, the blood-testing company whose founder Elizabeth Holmes was later convicted of fraud. A scandal involving Theranos and another client, Harvey Weinstein, severely damaged Boies' reputation, but for Roche he remains a role model.

When Roche struck the deal with Dr. Sirer in September 2019, he said he wasn't sure Dr. Sirer's project would succeed. At the time, his tokens were worth less than 3 cents each.

A year later, Sirer's blockchain Avalanche was officially launched. As the cryptocurrency became more and more popular, the price of AVAX token skyrocketed, surpassing $100, and Roche joined the ranks of multi-millionaires.

Roche's compensation agreement with Roche was supposed to be confidential, but anyone who wanted to gather intelligence on him would soon find out about it. In February 2021, Roche Freedman fired one of its partners, Jason Cyrulnik. He fought back with a lawsuit, disclosing each partner's share of AVAX tokens.

That fall, Kleiman v. Wright began in US District Court in Miami. Roche made a heated opening statement, during which he repeatedly pointed the finger at Dr. Wright.

In the end, the trial did not resolve the question of whether Dr. Wright actually invented Bitcoin, but the jury ordered him to pay $100 million in damages to a company that Ira Kleiman inherited from his deceased brother. (The judge later added another $43 million in interest.) Roche's law firm earned more than $10 million in fees.

With the Kleiman trial over, Roche turned to a project he and Dr. Sirer had been discussing: Ryval, a company that helps people raise money on Avalanche to pay for the lawsuit. Roche sees it as a for-profit crowdfunding platform for litigation, and believes it can level the legal playing field between individuals and large corporations.

But while he was plotting his new venture, someone was plotting his downfall.

4. Hongmen Banquet

Norwegian venture capitalist Christen Ager-Hanssen was among those who invited Roche to London.

In December 2021, Roche received an email from an acquaintance introducing him to Villavicencio, according to copies of the emails reviewed by The New York Times. Villavicencio identified himself as a colleague of Ager-Hanssen, a venture capitalist interested in Roche's new venture. Roche doesn't know who the two men are, but he welcomes the move: He's raising money for Ryval, a project that's getting some attention in the crypto press.

After a conference call, Roche agreed to fly to London at their expense next month.

They met in Ager-Hanssen's office, and things quickly took a strange turn: According to Roche, Ager-Hanssen pressed his index finger to Roche's forehead -- "I don't think it was a gun gesture, but I think He was trying to intimidate me"—and said that if he was going to invest with him, he needed to know everything Roche was capable of.

In hindsight, Roche wishes he had gotten up and left. Instead, he took it as a cue to sell himself even harder. According to Roche, Ager-Hanssen spent the next few hours coaxing him to brag about his relationship with Ava Labs while Villavicencio, who sat across from him, secretly filmed him.

Ager-Hanssen used information he gleaned from a lawsuit filed by the fired Roche Freedman partner to trick Roche into saying he had acquired 1% of Avalanche's AVAX token supply. At the time, this was equivalent to more than $100 million. (Roche said he inflated the figure by 1%, and AVAX tokens later lost 80% of their value).

Ager-Hanssen then asked Roche to give an example of how he could be useful to Ava Labs.

"I'm sure the SEC and the CFTC have other companies to watch," Roche said in the video. "Litigation can be a tool to attack competition."

Image credit, CryptoLeaks

When Roche came to Jean-Georges that night, he found Villavicencio waiting at a table with a drink waiting for him, he said. Roche remembers Ager-Hanssen arriving about 15 minutes later, sitting with a tall blond man at a nearby table. Roche said he has little recollection of the rest of the night. He now believes the drink was laced with drugs, although he has no proof.

In one video clip at the restaurant, Roche bragged about how he has the power to bring down companies with lawsuits. In another video, Villavicencio asks him if Ava Labs has sued any of its competitors. Roche replied: No, they put me in a class action. This suggests that he is filing class action lawsuits against other cryptocurrency companies at the behest of Ava Labs.

After the Jean-Georges dinner, Roche never saw Villavicencio again, although he had seen Ager-Hanssen for the last time in New York.

On Aug. 26, Roche was in California for a wedding when one of his clients saw the Crypto Leaks video on Twitter and sent him a link.

He was stunned and hurried to find out when and where the videos were recorded. Once he had a rough idea of what was going on, he called Freedman and contacted the customer to get the situation under control.

Roche is most concerned about his comments that he filed the lawsuit to hurt Ava Labs' competitors and distract regulators. It was baseless rhetoric, he said, and he wanted to impress potential investors because of his modest background. He said he began preparing the first suits a month before he met Ava Labs founder Dr. Sirer.

Dr. Sirer denies that he or Ava Labs has any involvement in the lawsuits, some of which he says he strongly disagrees with. Six weeks before Crypto Leaks released the video, Ava Labs' general counsel wrote an article criticizing a lawsuit by Roche Freedman as nonsense.

To protect his law firm, Roche dropped his participation in the lawsuit Roche Freedman brought against the cryptocurrency company, sold his stake in Ava Labs back to the company, and stopped representing the company. (Roche declined to say whether he made a profit on the sale).

But he realized that these actions were not enough, so he resigned from the company, which was renamed Freedman Normand Friedland.

Roche, the man behind the invisibility, is under the Williamsburg Bridge in Brooklyn, where he has been living in seclusion for a while after the video emerged in August.

via Gili Benita, The New York Times

A week after the video surfaced, Roche suffered another major blow: According to an affidavit later filed in court, a friend of one of his colleagues reported hearing rumors at a cryptocurrency event that Roche was alive. Danger. A terrified Roche and his fiancée took refuge in a short-term rental in Brooklyn.

Roche feels his world is collapsing. He said he became restless and lost 10 pounds. He and his fiancée returned to Miami a few weeks later, but still fearing for their safety, opted to move into a rental apartment owned by a relative.

When Roche's career suffered, Ager-Hanssen called for Roche's legal disbarment and tweeted a report he compiled on Roche that largely repeated Crypto Leaks' allegations. He also emailed Cyrulnik, a former Roche Freedman partner, offering to help him corroborate his allegations against Roche and his former firm.

To Roche, the whole thing was self-explanatory: Ager-Hanssen set him up.

In an interview, Ager-Hanssen denied this. "It's not an operation controlled by me at all, it's done by someone else," he said. He said he was genuinely interested in investing in the Ryval company, which Villavicencio filmed in his office without his knowledge. These videos, and he wasn't at the Jean-Georges Hotel that night. Ager-Hanssen said he thought he knew who was behind the attack, but he would not identify the person.

Villavicencio seems to have disappeared. He could not be reached at this time at the phone number and email address he left with Roche.

Ager-Hanssen said he had no knowledge of Villavicencio's whereabouts. He said he had only met the man a few weeks before Roche came to London, and that Villavicencio might not be his real name. "This is someone who doesn't exist," he said.

But Ager-Hanssen has long had a sideline, besides running his venture capital firm, digging up scandals about wealthy businessmen caught up in business disputes in Britain and Scandinavia.

On multiple occasions, he secretly taped his targets. In a 2014 interview, for example, he recounted how he used a hidden microphone imprint to lead a Swedish financier rival to boast that he had hired ex-intelligence agents from the CIA, MI6 and ISSO. personnel.

But if Ager-Hanssen did frame Roche, who hired him to do it—and why?

Five, a series of clues

British entrepreneur Dominic Williams, one of Roche's lawsuit targets, said he appreciated the Crypto Leaks coverage. via Stephen McCarthy/Sportsfile, Getty Images

Many had reason to celebrate Roche's downfall.

Topping the list are Dr. Wright, who claims to be Satoshi Nakamoto, and Calvin Ayre, the gambling tycoon who funded Dr. Wright. Dr. Wright quickly used the videos to file an unsuccessful motion to disqualify Roche in the Kleiman case. After the video came to light, Ager-Hanssen became CEO of nChain, a company backed by Ayre, and hired Dr. Wright as chief scientific officer.

Through a spokeswoman, Ayre admitted that he and Dr. Wright were elated when the video came to light. But they deny any connection to the hoax in London.

Roche believes them because he thinks he knows who hired Ager-Hanssen: Williams, the British entrepreneur is Roche Freedman

The target of the company's largest pump-and-dump case.

A series of clues documented in court documents by his former law firm led Roche to that conclusion. The first clue came when, on May 12, 2022, Williams tweeted that he was "coming" for his critics. On the same day, the domain name cryptoleaks.info was registered.

On June 9, 2022, the Crypto Leaks website goes live. The site, which bills itself as a defender of the "integrity of the cryptocurrency community," published two reports defending Williams' interests. The first report backs up the complex theory Williams had previously put forward on Twitter about the collapse of the ICP token.

The second attacked an article published by The New York Times about the collapse in ICP prices. Williams tweeted a link to the Crypto Leaks report, calling it shocking. The Dfinity Foundation, a Swiss nonprofit that Williams created to oversee its blockchain, is suing The New York Times for defamation in New York. (The New York Times is seeking the lawsuit dismissed.)

Roche's video is at the heart of Crypto Leaks' third exposure. After the videos were published, Williams and Dfinity filed a motion to disqualify Roche Freedman as attorney for the pump and dump plaintiffs, saying Roche's remarks were a disregard for the integrity of the judicial system.

In court filings opposing the motion, Roche's former company accused Williams of being behind the cryptocurrency leak and said videos taken at Jean-Georges showed signs of deepfake alterations. It also accused Williams of making rumors that Roche's life was threatened.

Pete Padovano, a spokesman for Dfinity and Williams, denied that anyone at the foundation had made death threats. When asked if he had anything to do with Crypto Leaks, Williams said: We are grateful to Crypto Leaks for their coverage and believe their articles speak for themselves.

Roche took a low-level schedule last fall, but he recently began rebuilding his career as a solo practitioner.

In April, he won a $12.5 million judgment on behalf of six former Cantor Fitzgerald partners who sued the firm for withholding some of their compensation. The decision on Cantor's appeal opens the way for Roche to file a separate class action against the company. Roche also represented dozens of investors in disputes with Binance.

But Roche's videotaped remarks continue to haunt him and his former company. Last month, the judge overseeing the fraud case granted Williams' motion and disqualified Freedman Normand Friedland as plaintiffs' attorney.

The judge reasoned that Freedman had a long-standing friendship with Roche and that they jointly controlled a cryptocurrency wallet containing more than one million AVAX tokens. He also expressed concern that the law firm harbored great ill will against Williams, which could lead it to reject a reasonable settlement offer.

Unless the lead plaintiff can recruit new lawyers by August, the lawsuit is unlikely to be reversed. From Roche's point of view, the plot against him worked perfectly.