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Aleksei Andriunin, the 26-year-old founder and CEO of cryptocurrency market-making firm Gotbit, has been extradited from Portugal to the United States to face charges of wire fraud and conspiracy to commit market manipulation.

Following his extradition, Andriunin appeared in a Boston federal court, where he was ordered detained pending further proceedings.

The charges stem from allegations that, between 2018 and 2024, Gotbit engaged in “wash trading”—a practice involving sham trades—to artificially inflate the trading volumes of various digital tokens. This manipulation purportedly aimed to enhance the market presence of these tokens, facilitating their listing and trading on larger cryptocurrency exchanges. Prosecutors assert that Gotbit executed wash trades worth millions of dollars and secured tens of millions in proceeds for its services, benefiting cryptocurrencies such as Saitama and Robo Inu.

The investigation, dubbed “Operation Token Mirrors,” marked a novel approach by the Federal Bureau of Investigation (FBI), which, for the first time, created its own digital token to identify and apprehend fraudsters within the cryptocurrency market. This operation led to the indictment of 15 individuals and three firms, including Gotbit, highlighting the increasing scrutiny and regulatory actions targeting fraudulent activities in the crypto sector.

Other Cryptocurrency Founders Facing Charges

In addition to Andriunin, several other cryptocurrency founders and executives have recently been charged with fraud and market manipulation:

• Douglas Jae Woo Kim: A 32-year-old from New York, Kim ran a fraudulent cryptocurrency business in San Francisco, defrauding investors—including friends—of over $7 million. Convicted on 14 counts of wire fraud and money laundering, he faces up to 20 years in prison per count, with sentencing set for June.
• Justin Sun: The founder of Tron is under investigation by the U.S. Securities and Exchange Commission (SEC) for allegedly inflating trading volumes, illegally distributing crypto assets, and secretly paying celebrities for promotions. He is currently in discussions with the SEC to resolve the case.
• Sam Bankman-Fried: The disgraced founder of FTX was convicted in 2023 of fraud and conspiracy following the exchange’s collapse. He was sentenced to 25 years in prison and ordered to forfeit $11 billion.
• Aux Cayes FinTech Co (OKX Operator): The company behind the OKX exchange pleaded guilty to violating U.S. anti-money laundering laws and agreed to pay over $505 million in fines and forfeitures after facilitating $5 billion in suspicious transactions.

These cases underscore the growing crackdown on fraudulent practices in the cryptocurrency industry as regulators and law enforcement intensify their oversight.