Bitzlato
A crypto exchange that U.S. and EU authorities say laundered roughly $700M+ of illicit funds, acting as a counterparty for the Hydra darknet market and ransomware crews. Its infrastructure was seized in January 2023; founder Anatoly Legkodymov pleaded guilty to running an unlicensed money-transmitting business.
Also known as: Bitzlato
Summary
Bitzlato was a Hong Kong-registered cryptocurrency exchange that, according to the U.S. Department of Justice, processed more than $700 million in illicit funds and marketed its lack of identity checks to attract criminal users. [1][2]
Takedown
In January 2023, U.S., French, Spanish, Portuguese, Cypriot, and Europol authorities seized Bitzlato's infrastructure and cryptocurrency, and Treasury's FinCEN designated it a "primary money-laundering concern." The exchange suspended operations the day after founder Anatoly Legkodymov's arrest in Miami. [1][2]
Illicit activity
Prosecutors said Bitzlato served as a counterparty for the now-defunct Hydra darknet marketplace and processed funds for ransomware operators. Europol estimated the platform converted assets totaling roughly €1 billion. [2]
Outcome
In December 2023, Legkodymov pleaded guilty to operating an unlicensed money-transmitting business, agreed to dissolve Bitzlato, and relinquished claims to about $23 million in seized assets. In July 2024 he was sentenced to time served (18 months). [1][2]
Bracketed numbers refer to the numbered sources listed below.
People & entities involved
Sources (2)
See also
- Loci (LOCIcoin)TokensA 2017–2018 ICO for 'LOCIcoin' tied to the InnVenn IP-search platform. The SEC charged Loci and CEO John Wise with fraud for raising $7.6M on false claims about revenue, headcount, and user base; Wise also misused investor funds. Settled with a $7.6M penalty and an officer/director bar.
- Blockchain Terminal (BCT)TokensA 2017–2018 ICO (BCT tokens, ~$30M) for a 'Blockchain Terminal' — a Bloomberg-style crypto trading terminal. The SEC and DOJ said convicted ex-hedge-funder Boaz Manor secretly ran it under a fake identity ('Shaun MacDonald'), using associate Edith Pardo as a front, and lied about the product's adoption.
- Crowd Machine (CMCT)Tokens
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