US Justice Department Charges Gotbit Founder with Fraud

The Massachusetts Attorney’s Office has charged Alexey Andryunin, founder and CEO of market maker Gotbit, with fraud and conspiracy to manipulate the cryptocurrency market.

Founder of cryptocurrency financial services firm “Gotbit” indicted for market manipulation and fraud conspiracy. Allegedly made tens of millions of dollars in proceeds for fraudulent “wash trading” services.
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— U.S. Attorney Massachusetts (@DMAnews1) October 31, 2024

In addition to the 26-year-old Russian citizen residing in Portugal, similar charges have been brought against the company itself and two directors—Fedor Kedrov, who oversaw Gotbit’s sales, and Kavi Jalili, who was responsible for market making.

According to court documents, from 2018 to 2024, the firm provided services to create artificial trading volumes for several market participants based in the United States.

In a 2019 interview, Andryunin allegedly described how he created code for fictitious cryptocurrency trading. The software allowed for inflated trading metrics to achieve rankings on CoinMarketCap and listings on major exchanges.

He kept records of market manipulations, including tables comparing created volumes with natural ones. To conceal its activities, Gotbit used multiple accounts and earned “tens of millions of dollars” from its services.

Andryunin transferred his personal income to his Binance account.

The fraud charge carries a penalty of up to 20 years in prison, a fine of $250,000 or double the gain/loss amount, and forfeiture of illegally obtained income.

If the Gotbit founder is found guilty of conspiracy, he faces up to five years in prison and similar financial penalties.

The case against Gotbit includes tokens such as Saitama Inu and Robo Inu.

Earlier, their creator, Wai Pham, settled charges brought by the SEC for fraud and market manipulation. The Vietnam-born U.S. resident agreed to return illegal profits and pay a fine.