The 35-year-old man behind Bitcoin Fog, a cryptocurrency mixing service provider has been convicted for his role in several money laundering cases.

Bitcoin Fog Used to Obfuscate Crypto Transaction Origin

Roman Sterlingov, the Russian-Swiss national masterminded the behind Bitcoin Fog protocol was indicted in a Washington federal court for taking part in a scheme that left many crypto users with losses running into tens of millions of dollars. Sterlingov was allegedly helping darknet markets specifically designed for the sales of illegal drugs to launder funds. 

The young man runs Bitcoin Fog which is a cryptocurrency mixer. Even though crypto mixers or tumblers have legal uses, especially for those traders seeking to be anonymous, such tools are usually exploited by criminals to jumble their loot in a crypto pool to obfuscate their origin. 

Government records claim that over $400 million in untraceable assets have been processed through Bitcoin Fog, some of which are from illegal activities. At a time, Sterlingov denied ever running Bitcoin Fog but with the government’s investigation, he faces the possibility of bagging up to 20 years of jail time. 

Ilya Lichtenstein, the popular Bitfinex hacker who was indicted alongside his wife Heather Morgan for stealing approximately 120,000 Bitcoin (BTC) in 2016 was one of those who utilized Bitcoin Fog. Unlike Sterlingov who runs a crypto mixer, Lichtenstein hacked into crypto exchanges to steal Bitcoin. Lichtenstein said he gained access to Bitfinex months before he perpetrated the heist. 

His loot from the Bitfinex heist were pooled into Bitcoin Fog for laundering before they were sent to different crypto exchanges under disguised names. 

US Government Cracking Down on Crypto Criminals

Sterlingov’s verdict is another guarantee that the United States government is keen on cracking down on crypto criminals no matter how long it takes. 

Sam Bankman-Fried, the former FTX CEO was convicted last year after initially pleading not guilty to the claim that he defrauded users of the now-bankrupt crypto exchange. After the Jury trial was concluded, he was pronounced guilty on 7 Count Charges after hearing testimonies from some of the executives who worked closely with him including his ex-lover Caroline Ellison.

Ilya Lichtenstein was even recently made a government witness in the Bitcoin Fog case.Changpeng Zhao, former Binance CEO is still facing trial and his bail bond was just modified by the U.S. government. He doesn’t get to leave the country until his sentencing.

The Bitcoin Fog founder faces up to 20 years in prison and his fate now hinges on what the provision of the law.

The post Bitcoin Fog Mastermind Eyes 20-Year Jail Term Amid Criminal Conviction appeared first on CoinGape.

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Filed under: News - @ January 1, 1970 12:00 am