Russian Crypto Exchange Co-founder Pleads Guilty to Operating Unlicensed Money Transmitting Business
Anatoly Legkodymov, also known as “Gandalf” and “Tolik,” has pleaded guilty in a US federal court in New York to charges related to operating an unlicensed money transmitting business. Legkodymov admitted to overseeing the Hong Kong-based crypto exchange Bitzlato, which served as a conduit for dark market transactions and ransomware criminals.
Bitzlato’s Role in Facilitating Illegal Activities
The charges against Legkodymov highlight Bitzlato’s lax controls over illicit money transactions and its marketing as a haven requiring minimal user identification. The exchange allegedly became a hub for criminal proceeds, particularly in dealings with Hydra Market, the largest darknet market for narcotics and illicit services.
Hydra Market’s Connection with Bitzlato
Users of Hydra Market exchanged over $700 million worth of crypto with Bitzlato until the darknet market’s shutdown in April 2022. The US Department of Justice has previously claimed that Hydra accounted for as much as 80% of global darknet market-related crypto transactions.
Joint Effort by US Authorities
The investigation into Bitzlato and Legkodymov was a joint effort by the US Attorney’s Office for the Eastern District of New York and the National Cryptocurrency Enforcement Team (NCET).
Hot Take: Crypto Exchange Bitzlato Faces Consequences
The guilty plea from Anatoly Legkodymov underscores the consequences faced by crypto exchanges involved in facilitating illegal activities. This case highlights the importance of robust KYC procedures to prevent criminal exploitation within the cryptocurrency industry. It also demonstrates the determination of US authorities to dismantle and disrupt the cryptocrime ecosystem. The collaboration between law enforcement agencies shows a commitment to holding individuals accountable for their actions in the crypto space.
By
By
By
By
By