The Bitzlato cryptocurrency exchange has been shut down, and the FBI has arrested the exchange’s owner, Anatoly Legkodymov, according to a statement from the U.S. Department of Justice (DOJ).
Representatives from the law enforcement agency disclosed via a live video on January 18th, 2023 that the Hong Kong-based exchange was purportedly part of a sizable criminal cryptocurrency network created to circumvent sanctions, launder money, and hide crimes.
In the statement, Legkodymov described Bitzlato as a high-tech financial hub that catered to “known crooks.” Additionally, “Bitzlato failed to implement safeguards required by U.S. law – safeguards that enable authorities to detect and investigate financial crimes.”
Officials cautioned viewers throughout the live stream that criminal actors would have to answer to American law authorities regardless of where they were or where they lived.
The DOJ stated that whether or not an individual violates U.S. laws or takes advantage of the U.S. financial system from another country, they should anticipate appearing in a U.S. courtroom to answer for their crimes.
The DOJ claims that between 2018 and 2022, Bitzlato facilitated more than $700 million in transactions involving illicit funds, however at the time of the live video, Bitzlato’s tagged wallets only contained $11,000 from a peak of $6 million.
Coinbase Director Conor Grogan provides screenshots of the tracked funds in a tweet below:
Within the last 24 hours, around $670,000 was withdrawn from the wallets.