According to a report from Bloomberg, Alexander Vinnik, the Russian who ran the virtual currency exchange BTC-e, pleaded guilty in the United States on May 3 to charges of money laundering conspiracy.
BTC-e was one of the world's largest cryptocurrency exchanges from 2011 to 2017. According to prosecutors, BTC-e processed $9 billion worth of transactions and had a customer base of more than 1 million people worldwide.
Prosecutors added that BTC-e was used by cybercriminals to transfer, launder and store criminal proceeds from illegal activities. This includes proceeds from hacking, ransomware, and drug distribution.
Vinick operated the exchange until his arrest and BTC-e was shut down by law enforcement, according to a statement from the U.S. Attorney's Office in San Francisco. Vinik, who was sentenced to five years in prison for money laundering in France in 2020, could face up to 20 years in prison in the United States.
The statement states:
“Vinnik operated BTC-e for the purpose of facilitating these illegal activities and incurred losses of at least $121 million.”
Prosecutors allege that BTC-e lacked a vetting system, allowing criminals to anonymously exchange illegal cash for cryptocurrencies such as Bitcoin. Prosecutors said the exchange was handling Bitcoin allegedly belonging to a Russian military intelligence hacking unit responsible for releasing Democratic emails to sway votes during the 2016 U.S. election. announced that it had been found out.
In recent months, the United States has seen increased scrutiny and regulatory action against crypto-related scams, and Sam Bankman Fried, co-founder of the now-defunct cryptocurrency exchange FTX, has been accused of multiple scams. In March, he was sentenced to 24 years in prison for organizing. -Billion dollar fraud scheme.
Additionally, Do Kwon, founder of Terraform Labs, was convicted of fraud in a civil case in April 2024. Terraform Labs went bankrupt in his 2022, causing a cascade of bankruptcies that wiped his $40 billion from the market.
More recently, Chao Changpeng (CZ), the founder of Binance, one of the world's largest cryptocurrency exchanges, was accused this week of allowing illegal activities, including criminal and terrorist financing, to occur on the platform. He was sentenced to four months in prison. CZ had previously pleaded guilty, and Binance had agreed to pay the largest fine ever and be subject to monitoring.
Additionally, former SEC Deputy Director of Enforcement Jennifer Lee said this week that if Donald Trump is elected president for a second term this year, the U.S. Securities and Exchange Commission (SEC) will continue to “define its territory and I will reach out to you.”
