The Russian founder of now-defunct cryptocurrency exchange Bitzlato has pleaded guilty, nearly 11 months after his death. arrested in miami at the beginning of this year.
Anatoly Legkodymov (aka Anatolii Legkodymov, Gandalf and Tolik), according to the US Department of Justice, admitted to operating an unlicensed money transmission business that allowed other criminal actors to launder their ill-gotten gains. He faces up to five years in prison.
"Legkodymov operated a cryptocurrency exchange that was open to business by money launderers and other criminals." saying Acting Assistant Attorney General Nicole M. Argentieri of the Department of Justice's Criminal Division.
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"He profited from serving criminals, and now he must pay the price. Transacting cryptocurrency does not put you beyond the reach of the law."
Bitzlato, which served as a safe haven for scammers and ransomware teams like contiIt is estimated that he received $2.5 billion in cryptocurrency between 2019 and 2023, more than half of which came from illegal and risky sources.
Before its removal by authorities, the Hong Kong-registered exchange also drew attention for its lax know-your-customer (KYC) procedures and promoted itself as a platform that required only minimal identifying information from its users. Some of its users are believed to have registered accounts using stolen identity documents.
The Department of Justice also highlighted Hydra's darknet marketplace as Bizlato's largest counterparty in cryptocurrency transactions, with users of the former trading no less than $700 million in digital assets with the exchange.
Hydra was the largest and oldest in the world. dark web market for narcotics, stolen financial information, fraudulent identification documents and money laundering services. It was dismantled by German and American authorities in April 2022.
"Legkodymov's guilty plea today confirms that he was well aware that Bitzlato, his cryptocurrency exchange, was being used as an open turnstile by criminals eager to take advantage of his lax controls over illicit monetary transactions," said U.S. Attorney Breon Peace for the Eastern District. from New York.
