Cryptocurrency exchange Binance reportedly processed approximately $346 million in crypto transactions for Bitzlato, a coin trading platform that was closed due to international law enforcement activity The U.S. authorities have been investigating the world’s largest transactions in digital assets. U.S. authorities said the world’s largest trading platform for digital assets was among Bitzlato’s major trading partners, owned by Russia.
Blockchain data shows that Binance has moved more than 20,000BTC for Bitzlato since 2018
Binance, a global leader in the crypto trading sector, has reportedly transferred almost $346 million worth of cryptocurrency for Hong Kong-based Bitzlato, Reuters reported, citing data from Chainalysis.Bitzlato is the latest in a series of cryptocurrencies that U.S. authorities have called “a It was a little-known exchange until it was recently targeted in what was described as a “major blow to the ecosystem.
Last week, the Justice Department announced that Bitzlato’s co-founder and majority shareholder, Anatoly Legkodymov, a Russian national living in China, was arrested in Miami and charged with operating an unlicensed money exchange business that processed $700 million in illicit funds.
On Wednesday, the U.S. Treasury Department’s Financial Crimes Enforcement Network (FinCEN) said Binance was the only major crypto exchange that traded with Bitzlato and one of its top counterparties. Among others were darknet marketplace Hydra, peer-to-peer (P2P) exchange Localbitcoins, and crypto investment scam Finiko, Russia’s largest financial pyramid in recent years.
According to FinCEN, Hong Kong-registered Bitzlato, well known to Russian-speaking users, was a “major money laundering concern” related to illicit finance in Russia. The bureau did not provide details about the size of the platform’s transactions with Bitzlato, but said that financial institutions would be prohibited from transferring funds to the exchange, without identifying the entities it was referring to.
According to data compiled by blockchain forensics firm Chainalysis and seen by Reuters, Binance moved more than 20,000funds between May 2018 and its closure, worth $345.8 million when the transactions took place BTCwere moved for Bitzlato. It was also noted that approximately $175 million worth of bitcoin was transferred from Bitzlato to Binance during this time, making Binance the largest receiving counterparty.
The largest crypto exchange says it assisted in the Bitzlato investigation
. Binance provided “substantial assistance” to international law enforcement agencies to support the Bitzlato investigation, a spokesperson for the exchange told the news agency in an email, while declining to provide further details about the crypto giant’s dealings with Bitzlato or its cooperation with authorities.
Finland-based Localbitcoins said it did not have “any kind of cooperation or relationship” with Bitzlato, while acknowledging that some P2P traders on its platform “would also have traded on Bitzlato’s P2P market” but noted that there has been no trading between the two exchanges since October 2022.
Reuters said there is no evidence that Binance, Localbitcoins, or Finiko’s transactions with Bitzlato violated any laws or regulations. Nor could he confirm whether Binance’s transactions with Bitzlato are currently under review. At the same time, the U.S.-led action against Bitzlato comes as the Department of Justice is investigating Binance for possible money laundering and sanctions violations.
A number of European countries are also involved in the investigation against Bitzlato. Last week’s announcement revealed that French law enforcement authorities have dismantled the country’s platform’s digital infrastructure and seized its website. On Monday, Europolnotifiedthat four more exchange members had been arrested in Spain and Cyprus.
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