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US authorities also links him to the failure of Mt Gox, a Japan-based bitcoin exchange that collapsed in 2014 after being hacked
Published : 12 Feb 2025, 11:17 PM
The United States will release Russian Alexander Vinnik, a suspected cybercrime kingpin, as part of an exchange with Russia that freed Marc Fogel, a US official said on Wednesday.
Vinnik operated BTC-e, once one of the world's largest cryptocurrency exchanges. He was arrested in 2017 in a small beachside village in northern Greece and detained at Washington's request on suspicion of laundering $4 billion through the exchange.
US authorities also linked him to the failure of Mt Gox, a Japan-based bitcoin exchange that collapsed in 2014 after being hacked. Vinnik "obtained" funds from the hack of Mt. Gox and laundered them through BTC-e and Tradehill, another San Francisco-based exchange he owned, the Justice Department said in a statement at the time.
Vinnik was initially extradited to France and later to the US, where he pleaded guilty in May 2024 to conspiracy to commit money laundering.
He was facing up to 20 years in prison. He had been due to be sentenced in January but a US federal judge in November agreed to postpone his sentencing until June, in a brief order that did not cite the reason for the delay, court records show.
The US Attorney's Office, Northern District of California, said BTC-e processed over $9 billion of transactions from around 2011 until 2017, when it was shut down after he was arrested. It served over a million users, many of them in the US.
"BTC-e was one of the primary ways by which cyber criminals around the world transferred, laundered, and stored the criminal proceeds of their illegal activities," the attorney's office said last year. It added that the exchange received criminal proceeds from numerous hacking incidents, ransomware attacks, identity theft schemes, corrupt public officials, and narcotics rings, and Vinnik ran it "with the intent to promote these unlawful activities".
US District Judge Susan Illston on Tuesday scheduled an afternoon status conference that day on Vinnik's case, court records show, without providing details on what was discussed in the hearing.
Andrei Zakharov, a journalist who has written a book on Vinnik, said the Russian was reputed to control 80,000 bitcoins stolen from Mt Gox in 2011, giving Moscow a strong interest in his return.
"80 thousand bitcoins. 8 billion dollars. 2 percent of federal budget revenues for 2025. Welcome home!" he posted on Telegram.
