The United States has extradited Aleksei Andriunin, the 26-year-old CEO and founder of Gotbit, a cryptocurrency market-making firm, from Portugal.
Andriunin, a Russian citizen, is facing serious charges, including wire fraud, market manipulation, and conspiracy. A federal grand jury in Boston has indicted him.
Gotbit Founder Extradited to the US
The US Attorney's Office for the District of Massachusetts confirmed his extradition on February 26, 2024. This is a significant development in the multinational crackdown on cryptocurrency fraud.
"It is alleged that from 2018 to 2024, Gotbit provided market manipulation services to generate fake trading volume for numerous Cryptoasset companies, including some in the United States," the press release stated.
Court documents reveal that Andriunin publicly admitted in a 2019 interview that he had created code to execute "wash trades." Wash trading is a practice where a trader buys and sells the same asset or security within a short period, creating a false appearance of high trading volume and liquidation.
"Andriunin is alleged to have maintained records of Gotbit's market manipulation, including spreadsheets comparing 'Volume Created' from wash trades to natural 'Market Volume'," the indictment stated.
Prosecutors allege that this fraudulent practice was the foundation of Gotbit's strategy to attract customers. Clients had paid high fees for what they believed was legitimate market support.
Other charges allege that Andriunin transferred millions of dollars in Gotbit's illicit profits into his personal accounts on the Binance cryptocurrency exchange.
Meanwhile, this case is part of a larger international campaign to combat cryptocurrency fraud. The Federal Bureau of Investigation (FBI) has led this campaign under the name "Operation Token Mirrors." During the investigation, FBI agents created a fake token called NexFundAI to trap manipulators.
The US intelligence service has seized over $25 million in Cryptoassets and shut down numerous trading Bots. These Bots were involved in manipulating trading volume and defrauding investors for around 60 tokens.
Legal actions began with an indictment announced on October 9, 2024. The indictment charged 18 individuals and entities, with Gotbit and two of its directors, Fedor Kedrov and Qawi Jalili, among those named.
Additionally, a superseding indictment on October 31, 2024, provided further details on Andriunin's role. The indictment alleges that he was the mastermind of the conspiracy.
If convicted, Andriunin could face up to 20 years in prison for wire fraud. He could also receive an additional 5 years for conspiracy to manipulate the market and commit wire fraud.
Each charge also carries a potential fine of up to $250,000 or twice the financial harm caused, along with supervised release, restitution, and asset forfeiture.
