Bitcoin from Defunct BTC-e Exchange on the Move Again: Report
The long-dormant bitcoin stash from the defunct BTC-e crypto exchange has been moving on the blockchain for the past two weeks, an anonymous member of a Russian Telegram channel noticed on Thursday.
The wallet received 3,299 BTC from the known BTC-e wallet in November 2022, in the first transaction sent by the BTC-e wallet since 2017. At that time, the wallet sent 10,000 bitcoin ($165 million) to two unidentified recipients. On March 14, one of the recipient wallets began moving funds again, eventually sending small chunks to exchanges and OTCs, presumably to withdraw bitcoin.
Blockchain analytics firm Crystal Blockchain confirmed to the Russian-language crypto website Forklog that smaller portions of this 3,299 BTC have been sent to the Kucoin and MEXC exchanges, as well as to an OTC desk called BTC2pm.
According to the on-chain data, around 2.75 BTC landed on Kucoin in two transactions via a bunch of intermediary wallets, and 1 BTC went to MEXC.
CoinDesk requested comment from Kucoin and MEXC. We’ll update the story when we hear from them.
US law enforcement agencies shut down BTC-e in 2017, arresting the alleged operator, Russian national Alexander Vinnik, at a resort near Thessaloniki, Greece. The US Department of Justice charged him with money laundering and other crimes.
After a stint in a Greek prison, a trial in France, Vinnik was finally extradited to the US last August to face charges of “computer intrusion and hacking incidents, ransomware, identity theft, corrupt public officials and drug distribution rings”. He is now at Santa Rita Prison in Dublin, Calif., according to the lawsuit.
Soon after BTC-e ceased operations, its successor, WEX, appealed to the BTC-e users offering to resume trading from their accounts and also get refunds for their lost funds. However, WEX also closed, a year later, the victim of internal conflict and fighting. WEX wallets were drained of millions of dollars worth of crypto, CoinDesk reported at the time.
In 2019, another Russian citizen, Alexei Bilyuchenko, admitted to being the administrator of WEX with control over all the funds, but said he was forced to transfer all the money to two unidentified officers from Russia’s Federal Security Service (FSB) who arrested him and extorted the money, according to the criminal case material the BBC has obtained.
Bilyuchenko is currently in a Russian prison called Matrosskaya Tishina in Moscow, according to former WEX users.
