Cryptocurrency exchange Binance has reportedly processed nearly $346 million in crypto transactions for Bitzlato, the coin trading platform that has been shut down in an international law enforcement operation. US authorities say the world’s largest trading platform for digital assets was among the top counterparties of Russian-owned Bitzlato.
Blockchain Data Indicates Binance Has Moved Over 20,000 BTC for Bitzlato Since 2018
Global cryptocurrency trading leader Binance has reportedly transferred nearly $346 million worth of cryptocurrencies for Hong Kong-based Bitzlato, Reuters reported, citing data from Chainalysis. Bitzlato used to be a little-known exchange until it was recently targeted in what US authorities have described as a “significant blow to the cryptocrime ecosystem”.
Last week, the Justice Department announced that Bitzlato co-founder and majority shareholder, Russian citizen Anatoly Legkodymov who lives in China, was arrested in Miami and charged with running an unlicensed currency exchange business. which processed $700 million in illicit funds.
The U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN) said on Wednesday that Binance was the only major cryptocurrency exchange that transacted with Bitzlato and one of its major counterparties. Among others were darknet marketplace Hydra, peer-to-peer (P2P) exchange Localbitcoins, and cryptocurrency investment scam Finiko, Russia’s largest financial pyramid in recent years.
The Hong Kong-registered Bitzlato, best known to Russian-speaking users, was a “prime money laundering concern” linked to Russia’s illicit finance, according to FinCEN. The bureau did not disclose details about the scope of those platforms’ transactions with Bitzlato, but said it would ban financial institutions from transferring funds to the exchange without specifying the entities to which it was referring.
According to data compiled by blockchain forensics firm Chainalysis and seen by Reuters, Binance moved more than 20,000 BTC for Bitzlato, worth $345.8 million at the time of the transactions, between May 2018 and its closure. Bitcoin worth around $175 million was transferred to Binance by Bitzlato during the period, making Binance its largest receiving counterparty, the report also noted.
The largest cryptocurrency exchange claims to have assisted the Bitzlato investigation
Binance has “provided substantial assistance” to international law enforcement agencies to support their investigation into Bitzlato, a spokesperson for the exchange said by email to the news agency, declining to provide further details on the giant’s reports. cryptocurrencies with Bitzlato or its cooperation with the authorities.
Finland-based Localbitcoins said it has never had “any kind of cooperation or relationship” with Bitzlato, while admitting that some P2P traders on its platform “would also trade in Bitzlato’s P2P marketplace,” but stressing that they did not there have been transactions between the two exchanges since October 2022.
Reuters noted that it has no evidence that Binance, Localbitcoins or Finiko’s transactions with Bitzlato violated any laws or regulations. It was also unable to establish whether Binance’s relationship with Bitzlato is currently under review. At the same time, the US-led action against Bitzlato comes as the Justice Department is investigating Binance for possible money laundering and sanctions violations.
Several European countries are also involved in the investigations against Bitzlato. Last week’s announcement revealed that French law enforcement has dismantled the platform’s digital infrastructure in the country and seized its website. On Monday, Europol reported that four more members of the swap team were arrested in Spain and Cyprus.
Do you expect Bitzlato’s alleged dealings with Binance and other crypto platforms to be further investigated? Share your thoughts on the matter in the comments section below.
Image credits:Shutterstock, Pixabay, Wiki Commons
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, nor a recommendation or endorsement of any product, service or company. Bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damages or losses caused or alleged to be caused by or in connection with use of or reliance on any content, goods or services mentioned in this article.