Why Did Virgil Griffith Plead Guilty?

The former Ethereum foundation developer pleaded guilty on Monday to advising North Korea on blockchain, reversing course in a pivotal legal case.

Sep 29, 2021
CoinDesk Insights

There has never been any doubt that Virgil Griffith did, in fact, go to North Korea and give a cryptocurrency talk. But the reason is still not immediately clear for his guilty plea on Monday, which ended the scheduled two-week trial in New York City on the first day.

The American citizen and former head of special projects at the Ethereum Foundation, accused of having tried to help North Korea break sanctions, had entered into a plea deal for a sentence of up to six and a half years, a reversal of the not-guilty position he had held for close to two years.

Ethan Lou’s new book is “Once a Bitcoin Miner: Scandal and Turmoil in the Cryptocurrency Wild West.”

Up until the day of, it looked as if the full trial would take place. Many thought Griffith would follow in the footsteps of other notorious hackers – like Aaron Schwarz, Weev and Kevin Mitnick – and fight the legal system, win or lose. Griffith was in remand after having his bail revoked, and his lawyers had specifically requested not one but two suits for court so he could “wear a different outfit on different days.”

Indeed, the formal document for the plea deal was dated Sunday, a day before the trial. Griffith’s lawyers have not elaborated on the matter publicly. The guilty plea is the latest cruel irony in a case that saw an adventuresome utopian disturb national security and geopolitics after wandering into one of the most repressive regimes on Earth.

In time, the full picture will emerge. It’s possible that a plea deal was always on the table, even if the parties did not say it publicly. While the judge is not bound by the agreement, the up to six and a half years it recommends for Griffith is vastly better than the maximum of 20 carried by the charge against him: conspiracy to violate the International Emergency Economic Powers Act. There is a lot we simply do not know yet.

What we do know is that Griffith has faced setback after setback in this case. For more than a year, as the matter progressed toward trial, the deck could have looked increasingly stacked for someone at the center of it all. And as Griffith revealed in court on Monday, the weight of it all compounded within him. Having been at that North Korean conference and followed the case closely, I was certainly not expecting a plea deal. But, in retrospect, I can see how it would make sense from Griffith’s point of view.

In court on Monday, Griffith didn’t even wear the suit jacket his lawyers had requested. He told the court he was being treated for depression and taking medication. At times he sighed audibly.

“I have a lot of complex feelings throughout my body,” Griffith said, adding that he had been meditating and had begun to realize with a “greater acuity” how “awful” he had been feeling.

Two blows had come in quick succession. The defense had sought testimony from the Ethereum Foundation’s general counsel, Tju Liang Chua, which it said was necessary to show that Griffith cared about obeying the law. Last Wednesday Judge Kevin Castel rejected a bid for Chua, based in Singapore, to give testimony remotely.

Then there was the matter of the defense’s request for a one-week postponement. Griffith’s lawyers told the court the prosecution had been “tardy” in disclosing evidence, and that the defense did not have “sufficient time to prepare for trial.” The prosecution said there had been no agreed-upon deadline for when to finish disclosure. Last Thursday, Castel said the prosecution did not act out of bounds and denied the postponement.

On top of everything, Griffith had spent the last two months in New York’s notorious Metropolitan Correctional Center. Griffith had violated his bail conditions by trying to access his cryptocurrency on the exchange Coinbase – to try to sell it to pay his lawyers.

The most well-known of Griffith’s lawyers, Brian Klein, had acted for the likes of the ShapeShift founder Erik Voorhees and defended the entrepreneur Charlie Shrem in a civil suit against the Winklevoss twins. Also on the case were Keri Axel and Sean Buckley, both former prosecutors now at top firms. On Monday in court, Griffith called them “fabulous.” Such talents do not come cheap.

Yet, even they could do only so much. Griffith faced a single charge of “conspiracy to violate” the sanctions law. That is, he was accused of trying to help North Korea violate sanctions, not necessarily succeeding. What the prosecution needed to prove wasn’t the ultimate outcome of Griffith’s deeds but the underlying intent. And intent is subjective – not necessarily in a way that might favor Griffith but definitely in a way that is hard to predict.

After all, the facts were not in dispute. Both sides largely agreed that Griffith had spoken at the North Korean conference and had later planned further cryptocurrency activities to do with the country. The prosecution even had a recording of Griffith’s remarks in North Korea.

Indeed, as Judge Castel had pointed out, the defense’s submission on the Ethereum lawyer Chua’s potential testimony had cited files in the prosecution’s evidence. Everything was already out in the open. How a jury would view everything – it would have been quite the gamble for Griffith.

Sitting in court on Monday, ready to capitulate, Griffith no doubt remembered a time when he would have taken such a gamble. Not long after his arrest he had appeared scrappy in an almost cheeky way. When asked back then how he would answer the charges, Griffith said he wasn’t guilty or not guilty but “innocent.”

More than a year later, while it is yet unclear what specifically has changed, something definitely has. When defendants admit crimes, the court has to be satisfied they know what is going on and are not coerced. Griffith had to make the admission in his own words. In that moment, it seemed as if, bit by bit, the judicial process had chipped away at him. The pain in his voice was noticeable.

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Ethan Lou is the author of Once a Bitcoin Miner: Scandal and Turmoil in the Cryptocurrency Wild West.