Blockchain accelerator Techstars has ended its partnership with Steven Nerayoff’s firm Alchemist after he was arrested last month in an alleged multi-million-dollar cryptocurrency extortion scheme.
Techstars told The Block on Monday that the move was “necessary," given several issues that have arisen around the viability of their partnership.
Steven Nerayoff is a technology entrepreneur involved with Ethereum, CasperLabs, tZero and other cryptocurrency projects, and via his firm Alchemist, he partnered with Techstars in 2018 to help blockchain entrepreneurs succeed. Nerayoff was co-lead of an accelerator program in New York City.
Now that the partnership has ended, Alchemist is no longer part of the program. Techstars told The Block that it will continue to work with other firms and mentors through its several accelerator programs.
Nerayoff wasa arrested last month by U.S. authorities on charges of extortion. He allegedly threatened to destroy a Seattle-based startup that issued cryptocurrency tokens as loyalty rewards to help clients attract users and sell products. He faces up to 20 years in prison if convicted.