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Criminal investigation on Bitcoin traders in Russia

05 September 2017 21:00, UTC

Last week, three men were arrested in the city of Kostroma (northeast of Moscow) and charged with ‘illegal banking’. They traded cryptocurrency, operating with more than two hundred of SIM cards and credit cards. According to the police, they operated with 500 million rubles, or 9 million U.S. dollars at the press time. To hide traces, they used the accounts of their relatives. The Federal Security Service (FSB, the Soviet KGB’s heir) took part in detention as well.

The illegal banking in Russia can get a person to 7 years in prison, so many cryptocurrency enthusiasts are concerned with this arrest and generally reiterate their conviction that Russian authorities should legalize cryptocurrencies and the related market instead of blocking a wide range of possibilities for the state economy.

Money laundering is, however, a real problem in Russia, often even with the state officials involved. The main issue about this story is we cannot determine for sure if those people were playing dirty or opened a company that worked without any cheating of its clients. Every Russian cryptocurrency enthusiast should know that this sphere is currently in the legal ‘gray zone’.