As the US pursues criminal suspects online, a Russian was charged with money laundering using a cryptocurrency exchange that reportedly concealed over $700 million in unlawful gambling and drug sales earnings.
The founder of the cryptocurrency exchange Bitzlato, Anatoly Legkodymov, was detained on Tuesday in Miami, the Justice Department announced at a press conference on Wednesday. According to Deputy Attorney General Lisa Monaco, Bitzlato, a company incorporated in Hong Kong, was a “key financial resource” for the Hydra dark web market, the biggest and most established of its kind. On the dark web, illegal items and services are traded.
According to a statement with the Justice Department, Bitzlato processed unlawful funds, including millions of dollars in ransomware profits. According to the US, Legkodymov, 40, a dual citizen of Shenzhen, China, and Russia, wrote on an internal chat that Bitzlato users were “known to be thieves.”
Monaco reportedly made a reference to the actions of FTX co-founder Sam Bankman-Fried when he said, “Whether you break our laws from China or Europe or misuse our financial system from a tropical island, you can expect to answer for your crimes inside a United States courtroom.” He currently faces federal fraud charges stemming from the collapse of his crypto enterprise, which he controlled from the Bahamas.
What is Bitzlato?
Bitzlato is a P2P crypto platform registered in Hong Kong. It first debuted in 2016.
People from various nations can post ads on Bitzlato stating the exchange rate and mode of payment for buying or selling any of the supported cryptocurrencies. You respond to these ads and decide to do business with the poster. When the parties have transacted and the seller has confirmed payment to Bitzlato, Bitzlato releases the applicable cryptocurrency from the escrow account and gives it to the buyer.