US Charges 2 Russian Nationals in Mt. Gox Hack Scheme
The US Department of Justice (DOJ) has charged two Russian nationals for their alleged role in the theft of hundreds of thousands of Bitcoins from the now-defunct Mt. Gox exchange.
US Charges 2 Russian Nationals in Mt. Gox Hack Scheme
On June 9, the DOJ announced that the suspects are Alexey Bilyuchenko (43) and Aleksandr Verner (29). Both individuals face charges of theft and money laundering, specifically for pilfering 647,000 Bitcoins (worth over $17 billion) in the Mt. Gox hack.
Additionally, the DOJ accuses the suspects of unlawfully operating another cryptocurrency exchange called BTC-e from 2011 to 2017. The US government shut down BTC-e in 2017, and Verner was extradited to the US last year.
The charges reveal a complex operation spanning multiple years and continents. US Attorney Ismail J. Ramsey from the Northern District of California stated in a press release:
"For years, Bilyuchenko and his co-conspirators are alleged to have operated a digital currency exchange for criminals around the globe— including computer hackers, ransomware operators, drug traffickers, and corrupt officials—laundering billions of dollars."
In February 2014, Mt. Gox was drained of 744,408 BTC from its hot wallet, leading to the exchange's bankruptcy and permanent closure. At the time, this was one of the most shocking hacks in the cryptocurrency industry. Before its collapse, Mt. Gox was one of the earliest and largest crypto exchanges, handling up to 70% of global Bitcoin transactions.
For more on this historic incident, see Coin68’s article: “The Mt. Gox Fiasco: A Retrospective Four Years After the Collapse of the World’s Largest Bitcoin Exchange”
Mt. Gox has been in the process of returning assets to creditors since March 10, with the deadline set for September 30. The reimbursement includes 142,000 BTC ($3.1 billion), 143,000 BCH ($16.7 million), and 69 billion Japanese yen (approximately $510 million) recovered by Japanese authorities from the attack.
The two largest creditors of Mt. Gox, Bitcoinica and Mt. Gox Investment Fund, which together account for one-fifth of the total claim value, have opted to receive their compensation in a lump sum of Bitcoin and cash rather than multiple installments, securing 90% of the total claim value from the exchange.
