Bitcoin took to it’s credibility this week.
U.S. law enforcement accused BTC-e, one of the world’s largest cryptocurrency exchanges, of facilitating criminal activity by not having enough oversight this week.
On Wednesday, the Treasury Department’s Financial Crimes Enforcement Network fined the digital asset exchange $110 million fine and its owner Alexander Vinnik, currently in Greek custody, $12 million. The Department of Justice a filed 21-count indictment against the Russian national Tuesday, the Wall Street Journal reports.
Law enforcement officials say BTC-e let its uers trade Bitcoin with a degree of anonymity, which effectively permitted money laundering on its network. The exchange transacted $4 billion generated from computer hacking, identity theft, faud, public corruption, and drug trafficking.
According to the Associated Press, a cellphone seized during Vinnik’s arrest in Greece on Tuesday is expected to yield key data in the investigation. Charges against the Russian, who’s awating extradtiion to the U.S., include numerous counts related to money laundering. If convicted, Vinnik could spent 20 years in prison.
The Justice Department acknowledges that cryptocurrencies like Bitcoin serve a legitimate purpose, according to the Wall Street Journal. Yet, the degree of anonymity for BTC-e users was insufficient compared to other exhanges’ protocol that better combat illicit finance.
This article was featured in the InsideHook newsletter. Sign up now.
