FBI Arrests Owner of Crypto Exchange Bitzlato for Illicit Activity

• The U.S. Department of Justice has closed the Bitzlato cryptocurrency exchange and arrested its owner, Anatoly Legkodymov, for allegedly running an illicit cryptocurrency network designed to launder money and conceal crimes.
• The DOJ alleges that Bitzlato facilitated more than $700 million in transactions involving illicit funds from 2018-2022.
• This event comes at a time of increasing scrutiny from law enforcement and regulators, with Gemini and Genesis recently charged by the SEC alongside FTX, while Three Arrows Capital has been accused of scamming its customers.

U.S Department of Justice Closes Cryptocurrency Exchange

The U.S Department of Justice (DOJ) has announced the closure of the Bitzlato cryptocurrency exchange, along with FBI’s arrest of its owner Anatoly Legkodymov for running an illicit network to circumvent sanctions, launder money and conceal crimes. In a live stream hosted on January 18th, DOJ representatives revealed that the Hong Kong-based exchange was allegedly involved in this activity.

Legkodymov Operated High-Tech Financial Hub

Legkodymov operated Bitzlato as a high-tech financial hub that catered to “known crooks,” according to his own words. Despite this, he failed to implement safeguards required by U.S law – safeguards which enable authorities to detect and investigate financial crimes. Additionally, during the live stream officials warned criminal actors regardless of their location or residence they must answer to U.S law enforcement or face consequences inside a United States courtroom if they break these laws abroad.

Increasing Scrutiny From Regulators

This announcement regarding Bitzlato comes at a time when there is increasing scrutiny from both law enforcement and regulators over alleged fraudulent activities in cryptocurrencies exchanges like FTX’s Bahamas hub, Gemini’s charges by SEC alongside FTX’s recent charges against those involved with it as well as Three Arrows Capital being accused of scamming its customers..

Bitzlatos Facilitated Over $700 Million Transactions Involving Illicit Funds

The DOJ alleged that Bitzlato facilitated more than $700 million in transactions involving illicit funds from 2018-2022 however at the time of live streaming only had $11000 on them compared to peak amount up to $6million showing discrepancy in volume between this event and other such events like Three Arrows Capital collapse who are also alleged for scamming their customers raising concerns over proper law enforcement in this industry .


To sum up ,the US department of justice have cracked down on Bitzlato crypto exchange along with arresting its owner Anatoly Legkodymov ,a high tech financial hub catering towards criminals failing to follow laws set by US government which can result into facing consequences inside US court room .These events come at a time where there is increasing scrutinizes from regulators due to frauds occurring on crypto exchanges with Three Arrows Capital being among one who are alleged for scamming their customers .Though involvement here was minor compared but still raised concerns .