Business & FinanceSpotlight

Russia, U.S. and France Eyeing BTC-e Operator Alexander Vinnik Regarding Possible Cyber Crime Activities

The prevalence of illegal practices in the cryptocurrency world has been unknown to none. Cryptocurrencies have been used by various criminal mediums across the world owing to the anonymity that they provide to its users.

Recently, a Russian citizen Alexander Vinnik, who was the operator of a Russian digital currency exchange BTC-e, has become the center of all attraction once again as BTC-e was allegedly involved in performing illegal criminal cryptocurrency transfers in the U.S. presidential elections of 2016. This news comes a year after Vinnik was accused by United States prosecutors in San Francisco of supervising BTC-e in possible criminal money laundering. After the rumor of BTC-e being involved in criminal activity broke out, Alexander Vinnik was captured in Greek last year.

Now, three countries including United States, France and Russia are demanding extradition of Alexander Vinnik. While U.S. has its claim of possible election intervention, France and Russia claim that Vinnik has commited crimes against its citizen so he should be handed over for further proceedings. Greece has been holding Vinnik for over a year now and while it seemed that Vinnik would be extradited to the U.S., the decision regarding his extradition has been stalled by the supreme court of Greece on the request of both France and Russia.

United States is leading the campaign of extraditing Vinnik and strongly wants to get its hands on him so that it could uncover what went down in the U.S. presidential elections and how the intervention of outside forces took place.

According to a cryptocurrency analysis firm Elliptic, the exchange BTC-e handled some of the digital assets trading to Fancy Bear which is a hacking unit. It is stated that Fancy Bear is referred to Russian military intelligence officers. Fancy bear is accused by the American attorney Robert Mueller of stealing and leaking emails of Democrats in order to tilt the vote balance in the 2016 U.S. elections. It was stated in the accusation made by U.S. prosecutors regarding the involvement of Alexander Vinnik and BTC-e that:

“BTC-e was an exchange for cybercriminals worldwide, and one of the principle entities used to launder and liquidate criminal proceeds from digital currencies, including Bitcoin, to fiat currencies, including U.S. dollar, Euros and Rubles. At all relevant times, the defendant, Alexander Vinnik, together with individuals known or unknown, directed and supervised BTC-e’s operations and finances.”

Also, in a report that was presented forward by U.S. Department of Justice (DOJ), it is suggested that cyber attacks were largely used for possible intervention in the U.S. presidential elections. It is reported by DOJ that:

“In or around 2016, the Russian Federation (“Russia”) operated a military intelligence agency called the Main Intelligence Directorate of the General Staff (“GRU”). The GRU had multiple units, including Units 26165 and 74455, engaged in cyber operations that involved the staged releases of documents stolen through computer intrusions. These units conducted largescale cyber operations to interfere with the 2016 U.S. presidential election.”

In the analysis that was presented forward by Elliptic, possible intervention of BTC-e was also mentioned. It was stated that:

“Elliptic analyzed these bitcoin transactions and was able to trace them back to a central wallet, seemingly controlled by Fancy Bear. The bitcoins in this wallet were further traced back to a number of sources including:

  • BTC-e, a cryptocurrency exchange that was shut down by the US Department of Justice in July 2017. It allowed trading between the U. S. dollar, Russian ruble, euro and a variety of cryptocurrencies. Russian national Alexander Vinnik was arrested in Greece for his alleged role in running BTC-e;
  • An online currency exchange, believed to be based in Slovakia, which enables the exchange of cryptocurrencies and other digital currencies such as Webmoney and Perfect Money;
  • The same European cryptocurrency exchange that was identified above as the source of funds for the payment made by “gfadel47”, as detailed in the DoJ indictment.”

In a nutshell, it seems that BTC-e was somehow involved in carrying out possible illegal activities in the U.S. presidential elections, with Alexander Vinnik being its supervisor. If extradited to the U.S., it might help the country figure out the possible alleged intervention of Russia in its elections. What remains to be seen is the decision that will be made by Greece’s supreme court regarding Vinnik’s extradition.

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Ahsan Khalid

News editor of BlockPublisher, an electrical engineer with majors in software development. Ahsan takes the engineer's approach for reporting legislation around the blockchain industry. Email: ahsan@blockpublisher.com or editor.news@blockpublisher.com

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