- Crypto market manipulation scandal as Andriunin and Gotbit face charges for inflating trading volumes to mislead investors.
- U.S. prosecutors claim Gotbit used “wash trading” tactics from 2018-2024, creating false crypto demand to secure exchange listings.
- The case highlights rising regulatory scrutiny on crypto, with potential sentences up to 20 years and hefty fines for wire fraud.
Aleksei Andriunin, a 26-year old Russian living in Portugal, stands accused of wire fraud and conspiracy in regard to manipulating cryptocurrencies. Andriunin, his firm Gotbit and two of its directors Fedor Kedrov and Qawi Jalili have been accused of manipulating trading volumes for their clients in cryptocurrency . This indictment is on top of the previous charges levelled against Gotbit on the10th of October, 2024.
According to a recent report, U.S prosecutors stated that Gotbit was an industry ‘market maker’ between 2018 and 2024. It reportedly engaged in “wash trading” scams which entail the fabrication of the turnover of goods in order to fake the higher turnover. These inflated volumes were employed to make cryptos ‘look’ ‘trending’ on platforms such as CoinMarketCap to bolster their appeal and make way for the listings on a top-tier exchange. In this alleged fraudulent plan, prosecutors said it fooled investors and manipulated demand for several digital assets.
Crypto Manipulation Scheme
According to a 2019 interview with Gotbit’s founder Andriunin, the company created software for wash trading since it generated large trading volumes for clients who wanted to gain attention. The indictment continues by stating that Andriunin’s team was very well-organized, recording the amount of the traffic made through wash trades against true market traffic. These records reportedly captured how Gotbit sought to exaggerate the demand for individual crypto tokens.
Kedrov and Gotbit’s Director of Sales Jalili are said to have sold this scheme to potential clients. Gotbit was further accused of having multiple accounts to make millions in artificial trades go unnoticed. They also claimed to have several clients in various digital assets such as Saitama and Robo Inu which are currently suspended from operating. According to prosecutors, the scheme earned Gotbit tens of millions of dollars in revenues.
Crypto Fraud Penalties
The charges attract legal repercussions with very less tolerance. The wire fraud charge, being on its own, can attract up to 20 years imprisonment, huge fines and forfeiture of property arising from such malpractice. Conspiracy to commit market manipulation and wire fraud might bring up to five years of imprisonment besides fines and other financial charges. They will be sentenced according to guidelines set by the federal judge within the united states sentencing commission.
This case underlines the increasing pressure, which the crypto industry is experiencing from the authorities that seek to reduce fraud activities in digital spaces. The result may have implications as to how different cryptocurrency platforms address issues of transparency and markets.
