Bitcoin Fog Operator Found Guilty of Money Laundering

A jury has found Russian Roman Sterlingov guilty of managing the Bitcoin Fog crypto mixer and laundering over $400 million, including $78 million linked to darknet markets, according to Bloomberg.

U.S. authorities arrested the alleged operator of the bitcoin mixing service in April 2021. Sentencing is scheduled for July 15, with Sterlingov facing up to 20 years in prison.

He is charged with conspiracy to launder money, money laundering, and two counts related to operating an unregistered money transfer service. The defendant pleaded not guilty.

“The defendant orchestrated the entire operation to help criminals conceal their assets,” stated prosecutor Kathryn Pelker.

According to her, the evidence clearly shows Sterlingov played a crucial role in creating Bitcoin Fog.

Defense attorney Tor Ekeland described the verdict as “disappointing” and announced plans to appeal.

During the month-long trial, prosecutors demonstrated to the jury how the government tracked cryptocurrency flows from darknet resources through Bitcoin Fog. They also highlighted a multi-step process Sterlingov allegedly used to pay for the Bitcoin Fog domain name over a decade ago.

Authorities were able to trace several small transactions from 2011 made from an account registered in Sterlingov’s name. According to the investigation, the accused used the funds to test the crypto mixer.

The main findings were based on research by Chainalysis. Previously, the defense attempted to challenge the evidence collected by the company.

Ekeland emphasized that the government found no mentions of Bitcoin Fog on Sterlingov’s electronic devices or laptops. He also disputed the logic presented to the court regarding his client’s funding of the service.

“This is only halfway through. […] There is no evidence that Sterlingov operated Bitcoin Fog,” the lawyer stressed.

Additionally, the court questioned Ilya Lichtenstein, accused of laundering billions of dollars in bitcoins linked to the Bitfinex exchange hack, and Larry Harmon, who admitted to running the Helix crypto mixer. Both witnesses stated they were not acquainted with Sterlingov.

In January, Tornado Cash co-founder Roman Storm and developer Alexey Pertsev began raising $1.5 million for legal fees. For this purpose, the JusticeDAO fund was established.

In February, the crowdfunding platform GoFundMe canceled a fundraiser to cover legal expenses for those accused in the crypto mixer case.