The European Union’s police agency (Europol) reported on Monday (23) that it had arrested five top executives of cryptocurrency exchange Bitzlato – which the United States shut down last week. According to a note from Europol, those arrested include the company’s CEO, finance director and marketing director in Spain. The arrests followed eight searches in Spain, Cyprus, Portugal and the US.
According to Europol, during the searches, agents seized around €18 million (R$101 million) in cryptocurrencies. In addition, authorities determined the freezing of more than 100 cryptocurrency accounts with assets worth BRL 281 million.
Understand the case of Bitzlato
As reported by the police agency, the Hong Kong-registered exchange with global operations is “suspected of facilitating the laundering of large amounts of criminal proceeds and converting them into rubles”.
“Bitzlato enabled quick conversion of various crypto assets like Bitcoin, Ethereum, Litecoin, Bitcoin Cash, Dash, Dogecoin and USDT into Russian rubles. The exchange is estimated to have received total assets worth EUR 2.1 billion (BTC 119,000),” Europol said.
The agency reasoned that while converting crypto assets into coins is not illegal, investigations into the crypto company’s operations indicated that large volumes of criminal assets were passing through the platform.
An analysis indicated that around 46% of assets traded through Bitzlato had links to criminal activity. This equates to around €1 billion (R$5.6 billion),
“For example, investigations have shown that 1.5 million BTC transactions were made directly between Bitzlato users and the [mercado da dark web] Hydramarket, deactivated in April 2022”, scored Europol.
US arrests Bitzlato founder
On January 18, as reported by CriptoFácil, the US arrested the founder of Bitzlato, the Russian Anatoly Legkodymov. Now, he must be taken to court on charges of running an unlicensed business that allegedly facilitated money laundering and other crimes.
Furthermore, authorities said that crypto exchange Binance was one of the top three recipients of Bitzlato’s illegal funds. Binance, however, denies any relationship with the exchange, as stated by a company spokesperson. The exchange stressed that it remains in cooperation with the authorities to ensure law enforcement.