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Crypto Exchange Bitzlato “Temporarily Suspends” Bitcoin (BTC) Withdrawals

Crypto Exchange Bitzlato “Temporarily Suspends” Bitcoin (BTC) Withdrawals

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Cryptocurrency exchange Bitzlato temporarily halted Bitcoin withdrawals just weeks after its founder agreed to dissolve the exchange. 

Crypto exchange Bitzlato announced that it “temporarily” halted Bitcoin withdrawals. The news comes after the exchange’s former CEO and co-founder, Anatoly Legkodymov, pleaded guilty to criminal charges in the US. 

Legkodymov Agrees to Dissolve Bitzlato

Bitzlato’s Telegram channel post says the exchange will “temporarily suspend” all Bitcoin withdrawals. The exchange explained that the decision was temporary as it prepared for upcoming legal proceedings in France. In its post, Bitzlato said:

“We are full of determination and optimism regarding this matter.”

Bitzlato’s co-founder and CEO, Anatoly Legkodymov, recently agreed to dissolve the exchange as part of a guilty plea in the US. 

Legkodymov was arrested in January and charged with allegedly facilitating money laundering for criminals. It is also alleged that the exchange facilitated the transfer of around $700 million in illicit funds. The arrest was a joint effort by the US Department of Justice, the Treasury Department, and French law enforcement. After Legkodymov’s arrest, the exchange’s assets were seized, but it partially restored access to user funds in March. 

In his plea deal, Legkodymov agreed to forfeit $23 million in cryptocurrency and to dissolve Bitzlato. In a press release, the US Attorney’s Office for the Eastern District of New York said Legkodymov pleaded guilty to operating a “money transmitting business that transported and transmitted illicit funds.” The press release further stated that Bitzlato served as a “primary conduit for dark market purchasers and sellers, as well as a safe haven for ransomware criminals.”

Association with Hydra Market and Binance Implication

Legkodymov revealed that Bitzlato dealt with Hydra Market and acknowledged the platform exchanging over $700 million in crypto with Hydra. Hydra Market was a darknet marketplace shut down by the US and German law enforcement.

Soon after the former CEO’s arrest, US authorities named Binance as a counterparty in the order. According to authorities, Binance was one of the top three receiving and sending counterparties with Bitzlato. 

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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