Trump Administration Looks to Make an Example out of BTC-E

Lawsuits have become increasingly common in the cryptocurrency world over the past few years. Given the number of scams, hacks, and shady businesses going around, that shouldn’t come as too much of a surprise. BTC-E, one of the more notorious platforms in history, is now facing a $100m lawsuit courtesy of the Trump administration. 

Another Chapter in the BTC-E History

Most cryptocurrency enthusiasts will be rather familiar with the BTC-E exchange and its history to date. It once was a big Bitcoin trading platform, albeit it seems the company was run into the ground by shady operators who tried to launder criminal proceeds. Russia’s Alexander Vinnik has become a person of great interest in this regard, primarily because he is suspected of being the exchange’s operator. 

While it has been relatively quiet where Vinnik and the shady exchange were concerned, that situation has come to change. In a surprising turn of events,  a new lawsuit against the exchange and Vinnik has been filed by none other than the Department of Justice. Many people see this as another sign of how the Trump administration will continue to crack down on Bitcoin and altcoin activity, either for better or worse. 

This creates a very interesting angle which will undoubtedly create a shockwave of sorts. Vinnik is still in custody in Greece, despite various governments trying to get him extradited. Any efforts by the US government to have him transferred to the United States have been unsuccessful. With this new lawsuit being filed, that situation may come to change over the next few weeks and months. Even so, it is possible other governments will step up their game once again, as this individual is suspected of laundering billions of dollars worth of Bitcoin and altcoins. 

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Interestingly enough, the lawsuit itself only focuses on one very specific aspect of how BTC-E was operated. It seems the DoJ is mainly interested in suing the company and its operator for running this service in the US without obtaining regulatory approval. It is a common tactic in the cryptocurrency world, as every service provider should register with FinCEN as a Money Services Business. Moreover, there are concerns over its suspicious activities, although very little extra information is provided at this point. 

For those users who lost a lot of money because of BTC-E, it seems unlikely this new lawsuit will offer them any real closure. Such filings can take months, if not years before a trial can even be conducted. Even then, it appears as if Vinnik managed to get rid of most of the money laundering through the exchange, albeit an investigation may turn up a hidden stash or two. Recovering the funds will be a very difficult task, as is usually the case where cryptocurrencies are concerned. 

How this new development will affect the future of cryptocurrencies in the US, is a different matter altogether. Actively cracking down on nefarious and suspicious activity is a promising sign, although it could lead to much harsher regulatory measures down the line. As the US does not have much of a policy on Bitcoin and similar currencies, the actual regulatory drafts could span literally anything and everything. 

Disclaimer: This is not trading or investment advice. The above article is for entertainment and education purposes only. Please do your own research before purchasing or investing into any cryptocurrency or digital currency.

JP Buntinx

JP Buntinx is a FinTech and Bitcoin enthusiast living in Belgium. His passion for finance and technology made him one of the world's leading freelance Bitcoin writers, and he aims to achieve the same level of respect in the FinTech sector.

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