The U.S. Department of Justice (DOJ) is charging the founder and CEO of crypto firm Gotbit with wire fraud and conspiracy to commit market manipulation and wire fraud.
In a new press release, the U.S. Attorney’s Office of the District of Massachusetts is alleging that 26-year-old Russian national Aleksei Andriunin and two Gotbit directors offered and promoted crypto market manipulation services between 2018 and 2024.
According to authorities, Gotbit – known as a market maker at the time – would engage in market manipulation to artificially boost trading volumes for crypto projects, including companies located in the US, though no specific entities were named.
Andriunin and his cohorts Fedor Kedrov and Qawi Jalili would allegedly “wash trade” crypto assets using computer code to inflate their trading volume and get them listed on websites such as CoinMarketCap, which keeps track of trending cryptocurrencies, and larger crypto exchange platforms.
Gotbit allegedly marketed its illicit tactics to potential clients and traded the crypto assets on their behalf. Prosecutors say Gotbit received tens of millions of dollars for its fraudulent services.
According to the press release, it is believed that Andriunin moved much of Gotbit’s proceeds to his personal Binance account.
Wash trading is when an entity buys and sells an asset simultaneously, often at inflated prices, giving the impression that there is heightened demand and market activity surrounding it.
If convicted of the charges, Andriunin is facing a sentence of up to 20 years for wire fraud, five years in prison for conspiracy to commit market manipulation and wire fraud, as well as possible fines, restitution and forfeiture.
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