October 3, 2022

A lot of scams happen in the crypto industry, especially BTC. If an investor is not careful, they will fall victim to cybercriminals posing as legitimate projects or platforms. Sometimes, some exchanges may experience problems and cause huge losses to investors. This happened with WEX, BTC-e and other exchanges that caused people to lose funds.

Vinnik is a Russian national known as the operator of BTC-e, one of the original Bitcoin exchanges. The exchange is linked to the hack of Mt. Gox, the first Bitcoin exchange with a 744,408 BTC attack.

However, there was no recovery for the stolen funds and the exchange was closed in 2014. Vinnik, for his part, never accepted to run BTC-e, but said that he was a staff member of the exchange.

However, in 2017, US authorities shut down the BTC exchange and seized its servers. Vinnik was arrested while staying with his family on a beach in Greece. Since his arrest, there has been a tug-of-war between the three countries, the US, Russia and France. They are vying for Vinnik’s extradition, each citing different allegations against him.

A report from CNN revealed the extradition of crypto exchange operator Alexander Vinnik to the United States from Greece. The cryptocurrency exchange operator was detained in France, but his French lawyer, Frederic Bellot, revealed his extradition.

After several attempts to extradite Vinnik, US authorities withdrew their request a few weeks ago. With the request withdrawn, Vinnik could be transferred to Greece and then to the United States.

In 2020 a California court indicted Vinnik on allegations of multiple criminal offenses. These include ransomware scams, computer intrusions and hacking, drug distribution rings, identity theft schemes and corrupt public officials.

France sentenced Vinnik to 5 years in prison for BTC fraud

France succeeded later in 2020 as they acquired Vinnik and a French court sentenced him to 5 years in prison. Vinnik was charged with money laundering. But other charges such as conspiracy, extortion and distortion of automatic data processing systems were dropped. Also, the Paris Court of Appeal upheld the prison terms.

Vinnik’s lawyer, Belot, did not explain the legal mechanism used by US authorities in their extradition request. However, he said that if the US withdraws its request, it will reactivate Greece’s request.

The launch of WEX, a descendant of the cryptocurrency exchange, took place a few months after the shutdown of BTC-e. WEX had trading pairs and website design quite similar to BTC-e. He had gained access to BTC-e’s user base. It also promised to gradually refund BTC exchange users for all their losses before the platform was shut down.

Reports show Alexander Vinnik, BTC Exchange Operator issued in the US
Bitcoin remains in a sideways momentum | Source: BTCUSDT on TradingView

In the summer of 2019, WEX ceased operations. Users complained that they had problems with withdrawal. They also noticed that the price of BTC became higher than what other exchanges were offering.

In addition, the CEO of WEX, Dmitry Vasiliev, was repeatedly arrested in various countries. These include Croatia, Italy and Poland.

Featured image from Pixabay, chart from TradingView.com

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