US prosecutors have filed an appeal against the sentences of time served given to HashFlare co-founders Sergei Potapenko and Ivan Turõgin, who were indicted for running a $577 million Ponzi scheme. The prosecutors argued in a Seattle federal court that the pair should serve ten years in prison due to the serious harm caused to victims, stating it was the most significant fraud case the court had seen. Potapenko and Turõgin had been held in custody for 16 months in Estonia before their extradition to the US, where they pleaded guilty to conspiracy to commit wire fraud. They were sentenced to a fine and community service instead of prison time, which has drawn criticism. The case highlights broader concerns about a lack of accountability for bad actors in the crypto space, as experts note a trend of minimal consequences for crypto-related crimes. Despite claims from the founders that victims have been repaid due to the rising crypto market, prosecutors contested these arguments, asserting that justice remains unserved for many victims.

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