Fraud and theft are two very real problems in the world of cryptocurrency. Unfortunately, it seems these problems will only be getting worse as time progresses. One cryptocurrency trader in Chicago has been charged with fraud for allegedly stealing US$2 million worth of Bitcoin and altcoins from his employer. This action was taken to cover personal financial losses due to bad trading. It is a very worrisome development, although the investigation is still underway as we speak.

Another Cryptocurrency-related Theft

If there is one positive aspect of Chicago, it is that there have never been criminal prosecutions involving cryptocurrencies up to now. Not long ago, a Chicago-based cryptocurrency trader was charged with fraud for stealing money from his employer. It is believed he stole up to US$2 million worth of Bitcoin and other currencies to cover his prior trading losses. The culprit, Joseph Kim, was charged with one count of wire fraud and decided not to enter a plea.

Kim is an assistant trader for Consolidated Trading. This Chicago-based firm trades increasingly popular cryptocurrencies, including Bitcoin and some of the top altcoins. Between September and November, the company saw money being sluiced to unofficial accounts, eventually adding up to US$2 million in losses. The company’s Bitcoin and Litecoin balances were slowly drained as Kim moved funds to his personal account. He also went through the trouble of forging statements to hide the theft.

For the time being, Kim has a bond set at US$100,000 and cannot travel between Northern Illinois and Arizona. The latter location is where Kim has one of his residences, which is why the area is off limits for the time being. Moreover, Kim gave up his passport and agreed to additional restrictions imposed on him. It seems he is all too aware of the problems he caused and the theft he committed. For a 24-year-old, the theft was a rather desperate move, to say the least.

With the rise in popularity of Bitcoin and other cryptocurrencies, it is not surprising to see people become desperate to get their hands on it. Rather than buying and holding Bitcoin, some people will look for an easy way in the hopes of getting away with it. As the federal prosecution of Joseph Kim shows, the truth will always come out eventually, and no theft will go unpunished. Cryptocurrencies are not suited for criminal use whatsoever, as it is impossible to hide the truth for long.

It is unclear what punishment awaits Kim, though. If the one charge of wire fraud sticks, he will spend a lot of time in jail in the future. More importantly, it will effectively destroy any career he may have left in the financial sector. Stealing money from your employer – cryptocurrency or otherwise – is always unacceptable. This sends another clear warning to anyone else with similar aspirations not to pursue this avenue.

It is highly likely we will see more thefts involving Bitcoin and other cryptocurrencies in the future. After all, this new form of money has attracted a lot of attention, and a lot of people still assume it is anonymous. Moreover, governments consider Bitcoin and altcoins to be perfect tools for criminals, even though they are clearly not to be used in such a capacity. Most currencies lack privacy and anonymity features, and hence aren’t suited for criminal purposes. Additionally, these markets are not liquid enough to move vast amounts of money without leaving digital breadcrumbs revealing one’s identity.