Crypto Exchange Bitzlato Co-Founder Pleads Guilty to U.S. Money Transmitter Charge

Anatoly Legkodymov says he'll dissolve the sanctioned exchange as part of his plea.

AccessTimeIconDec 6, 2023 at 9:59 p.m. UTC
Updated Mar 8, 2024 at 6:22 p.m. UTC

Anatoly Legkodymov, a co-founder of Hong Kong-based crypto exchange Bitzlato, pleaded guilty to operating an unlicensed money transmitter tied to allegations that the exchange processed funds from ransomware attacks, illicit drug deals and other crimes, U.S. officials announced Wednesday.

Legkodymov, a majority owner in the exchange, "agreed to dissolve Bitzlato" and release claims over some $23 million in seized assets, a U.S. Department of Justice (DOJ) press release said. Bitzlato was sanctioned by the U.S government in January, when the Treasury Department and DOJ alleged it laundered some $700 million worth of funds, and Treasury's Financial Crimes Enforcement Network designated the exchange as a "primary money-laundering concern," which functionally blocked it off from the global financial system.

Police had arrested Legkodymov in Florida, though his case has since been moved to the U.S. District Court for the Eastern District of New York.

European Union police entity Europol later alleged that Bitzlato laundered over $1 billion worth of funds. The little-known exchange's largest counterparty was darknet marketplace Hydra, the DOJ said, which allowed transactions for fake ID information, stolen financial information and money laundering.

In a statement, Deputy Attorney General Lisa Monaco called Bitzlato a "safe haven for fraudsters, thieves and other criminals."

"We are dismantling and disrupting the cryptocrime ecosystem using all tools available – including criminal prosecution," she said. "In January, the department and our partners took down Bitzlato’s infrastructure and seized its cryptocurrency. Today’s conviction of Bitzlato’s founder is the latest product of our efforts."

Another co-founder of Bitzlato, Anton Shkurenko, said at the end of January that the exchange would reopen, though its main website still displayed a notice that it was seized by French prosecutors as of Dec. 6.

Edited by Jesse Hamilton.


Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

CoinDesk is an award-winning media outlet that covers the cryptocurrency industry. Its journalists abide by a strict set of editorial policies. In November 2023, CoinDesk was acquired by the Bullish group, owner of Bullish, a regulated, digital assets exchange. The Bullish group is majority-owned by; both companies have interests in a variety of blockchain and digital asset businesses and significant holdings of digital assets, including bitcoin. CoinDesk operates as an independent subsidiary with an editorial committee to protect journalistic independence. CoinDesk employees, including journalists, may receive options in the Bullish group as part of their compensation.

Nikhilesh De

Nikhilesh De is CoinDesk's managing editor for global policy and regulation. He owns marginal amounts of bitcoin and ether.