Bitzlato founder pleads guilty to laundering $700m and agrees to close the company

The founder of the Bitzlato crypto-exchange, Anatoly Legkodymov pleaded guilty to transferring and laundering criminal proceeds.

According to prosecutors, the Russian national owned a controlling stake in the company, which served as a primary channel for darknet traders and ransomware operators.

As part of the guilty-plea agreement, Legkodymov agreed to close Bitzlato and relinquish any claims to about $23 million related to the exchange’s seized assets.

The first details of a possible deal between the executive and prosecutors emerged in April, but at the time platform staff described it as unreliable.

Prosecutors noted that Bitzlato marketed itself as an exchange with minimal user identification and allowed accounts to be registered under fictitious identities. The prosecution added that the team knew the service was being used by criminals.

Anatoly Legkodymov was arrested in Miami on January 17. The exchange’s operations were paused the following day.

It later emerged of the arrest of former chief executive Mikhail Lunyev, marketing manager Alexander Goncharenko, the Monolithos DAO implementation contractor Pavel Lerner, and the platform’s system administrator.

As ForkLog later stated, the lawyers said all those arrested “were not part of the core team, but were either contractors or consultants, some of whom never participated in the company’s core activities.”

According to Europol, in total the exchange converted assets linked to criminal activity worth about about €1 billion ($1.08 billion), including $700 million linked to the dark-net marketplace Hydra, and $15 million for ransomware operators.