news.bitcoin.com
A Russian founder of cryptocurrency exchange Gotbit has been extradited to the U.S. to face charges of wire fraud and conspiracy to commit market manipulation.
Code for Wash Trading Crypto Transactions
Aleksei Andriunin, 26, founder of cryptocurrency exchange Gotbit, has been extradited to the United States to face charges of manipulating cryptocurrency markets on behalf of clients. A statement released by the U.S. Attorney’s Office for the District of Massachusetts said Andriunin, who was arrested in Portugal on Oct. 8, 2023, made his initial court appearance Feb. 25.
A federal grand jury in Boston subsequently indicted Andriunin, a Russian national, on charges including wire fraud and conspiracy to commit market manipulation and wire fraud. The jury also indicted Gotbit and two directors, Fedor Kedrov and Qawi Jalili.
In the statement, U.S. officials accuse the Gotbit founder of providing market manipulation services for multiple cryptocurrency companies, including those based in the United States. It added that the Gotbit founder had admitted to developing a code to “wash trade” cryptocurrencies to artificially inflate trading volumes of cryptocurrencies “listed” on Coinmarketcap.
Alongside Gotbit employees, Andriunin is said to have marketed and subsequently earned millions of dollars for services rendered.
“Andriunin and Gotbit’s employees, including Jalili (Gotbit’s director of sales) and Kedrov (Gotbit’s director of market making), allegedly marketed these wash trading tactics to prospective clients and explained how Gotbit used multiple accounts to avoid detection of the wash trades on the public blockchain. Gotbit allegedly made wash trades worth millions of dollars on behalf of clients and received tens of millions of dollars in proceeds in connection with these fraudulent services. It is alleged that Andriunin transferred millions of dollars of Gotbit’s proceeds into his personal Binance account,” the U.S. Attorney’s statement said.
On the charge of wire fraud, Andriunin faces a maximum prison term of 20 years and a fine of up to $250,000 ‘or twice the gross gain or loss from the offense, restitution and forfeiture.’ For the conspiracy to commit market manipulation and wire fraud, the Gotbit founder faces five years in prison and up to three years of supervised release.