Bitzlato Founder Held Without Bail as More Sanctions Evasion Comes To Light

Legkodymov’s “access to cryptocurrency” and status as a Russian national who was in the US on a visa are reasons he should be detained, a judge said

article-image

Anton27/Shutterstock.com modified by Blockworks

share

Bitzlato founder Anatoly Legkodymov made his first appearance on Tuesday in New York, where the Russian national accused of processing more than $700 million in illicit funds was denied bail. 

United States Magistrate Judge Vera M. Scanlon cited Legkodymov’s “access to cryptocurrency” and status as a Russian national who was in the US on a visa as reasons for keeping him detained. 

Under no conditions of release could Legkodymov be trusted to remain in the US and in good standing, Scanlon said in the order of detention filed Tuesday. 

The hearing was Legkodymov’s first since the US announced charges for allegedly facilitating the laundering of illicit funds in January

Legkodymov, the founder and majority owner of Hong Kong-based exchange Bitzlato, also helped process “millions in ransomware proceeds,” the Department of Justice said

The bail hearing comes as more reports of cryptocurrency being used to evade Russian sanctions surface. 

The Russian branch of Transparency International, an international anti-corruption nongovernmental organization, said at least eight different exchanges are currently operating in Russia without know your customer (KYC) policies. 

Concerns about Russian government officials and citizens using crypto to side-step sanctions prompted by the invasion of Ukraine in 2022 have swirled for the past year

US-based cryptocurrency exchanges and wallet providers must follow the same reporting and KYC regulations as banks, but decentralized exchanges and marketplaces in other countries may offer a workaround.

As for Legkodymov’s case, his next hearing has not yet been scheduled. His attorneys can appeal the bail decision.


Don’t miss the next big story – join our free daily newsletter.

Tags

Upcoming Events

Hilton Metropole | 225 Edgware Rd, London

Mon - Wed, March 18 - 20, 2024

Crypto’s premier institutional conference returns to London in March 2024. The DAS: London Experience: Attend expert-led panel discussions and fireside chats Hear the latest developments regarding the crypto and digital asset regulatory environment directly from policymakers and experts.

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research report - cover graphics (1).jpg

Research

In this report, we dive into crypto private market data to gather insights on where the future of the industry is headed. Despite a notable downturn in private raises, capital continues to infuse promising projects that aim to transform payments, banking, consumer experiences, community, and more, with 2023 being the fourth-largest year for crypto venture capital.

article-image

BUZZ holds shares of Coinbase, Robinhood and MicroStrategy

article-image

Opinion: Even though I didn’t pay for my “Diamond Hands” burger with BTC, don’t let that fool you into thinking that crypto’s development is futile

article-image

The results mark “a major positive inflection point,” one analyst says, as the exchange carries net income momentum into a crypto rally

article-image

While the slate of 10 US spot bitcoin funds have tallied $4.6 billion of net inflows thus far, half of the field is lagging the leaders

article-image

Trading volumes totalled $154 billion in Q4, including $125 billion in institutional volume

article-image

DeFi on Bitcoin is all the rage right now and Stacks is positioned to benefit