Russian Crypto CEO Faces DOJ Indictment in Massive Market Manipulation Crackdown

The US Department of Justice (DOJ) has charged Aleksei Andriunin, the CEO of cryptocurrency firm Gotbit, with wire fraud and conspiracy for market manipulation.

Andriunin, a Russian national living in Portugal, is accused of running a global wash trading scheme to pump up trading volumes and deceive investors and exchanges worldwide.

According to the DOJ, Gotbit was a “market maker” for client companies, pumping up volume to make them visible and credible. By creating fake trades, callegedly helped clients get listed on CoinMarketCap and access larger exchanges.

Prosecutors say Andriunin’s manipulation services were marketed as a way to “create visibility” for crypto projects by simulating interest in the market.

How it Worked: Fake Trades and Inflated Visibility

According to court documents, Andriunin and Gotbit used wash trading to create artificial trades to make it look like there was high demand for certain cryptocurrencies.

This practice, often criticized for deceiving investors, allowed Gotbit’s clients – including US-based companies – to get listed and more visible in the competitive crypto market.

The DOJ says Andriunin tracked “Created Volume” from these fake trades, compared it to real market data, and marketed this as a service to make trading successful. This manipulated the market and deceived investors and exchanges on the popularity of certain tokens.

Legal Consequences for Andriunin and Gotbit Executives

If convicted Andriunin faces up to 20 years in prison, $250,000 fine or twice the gain, and supervised release. Other Gotbit executives – Fedor Kedrov and Qawi Jalili – are also named. Conspiracy to commit market manipulation carries 5 years, plus fines, restitution and asset forfeiture.

Takeaways:

• Wash Trading: Gotbit CEO created fake trades to pump up volume.
• Effect: Clients got listed on major platforms, investors deceived.
• Big penalties: 20 years in prison and big fines if convicted.

This is another sign of the DOJ’s crackdown on market manipulation in crypto.