Gotbit’s Founder Guilty of Market Manipulation and Fraud Conspiracy in Massachusetts Cryptocurrency Case

Gotbit founder Forfeits $23 Million in Landmark Crypto Market Manipulation Case

Boston, MA – In a significant victory for U.S. investors, Gotbit Consulting LLC, a cryptocurrency “market maker,” and its founder, Aleksei Andriunin, pleaded guilty in federal court in Boston on March 22, 2025, to charges stemming from a sophisticated scheme to manipulate cryptocurrency trading volumes. The case underscores the ongoing challenges of regulating the burgeoning digital asset market and protecting consumers from fraud.

By archyde.com News Team

March 22, 2025

The Guilty Plea and Extradition

Andriunin, 26, a citizen of both russia and Portugal, and his company, Gotbit, admitted guilt to wire fraud and conspiracy to commit market manipulation and wire fraud.This admission followed Andriunin’s arrest in Portugal on Oct. 8,2024,and his subsequent extradition to the United States on Feb. 25, 2025. The case highlights the reach of U.S.law enforcement in pursuing cryptocurrency-related crimes, even those with international dimensions.

The implications of Andriunin’s cooperation could ripple significantly through the crypto world. His testimony and the evidence gathered could lead to further investigations and prosecutions of individuals and companies involved in similar market manipulation schemes. This could set a precedent for stricter enforcement and regulatory oversight in the cryptocurrency industry.

Indictment and Allegations of Market Manipulation

Both Gotbit and Andriunin were initially indicted by a federal grand jury in October 2024 on charges of wire fraud and conspiracy, and the indictment also named two of Gotbit’s directors, Fedor Kedrov and Qawi Jalili, adding another layer of complexity to the legal proceedings. These charges were based on allegations that Gotbit functioned as a “market maker,” providing services designed to artificially inflate trading volumes for various cryptocurrency companies between 2018 and 2024.

Court documents detailed how Gotbit targeted companies both within the United states and those whose cryptocurrencies were traded on platforms accessible to U.S. investors. Andriunin, as Gotbit’s Founder and Chief Executive Officer, played a central role in developing and implementing these manipulative tactics.

Andriunin’s own words from a 2019 interview revealed the extent of the scheme. He described developing code to wash trade cryptocurrencies, a practice designed to artificially inflate trading volume. The goal? To boost the cryptocurrencies’ visibility on platforms like CoinMarketCap and secure listings on larger cryptocurrency exchanges.

In a 2019 interview, Andriunin described how he developed a code to wash trade cryptocurrencies to artificially inflate trading volume for the purpose of getting cryptocurrencies listed on CoinMarketCap (a website that published information about “trending” cryptocurrencies) and trading on larger cryptocurrency exchanges.

Gotbit allegedly marketed these illegal “wash trading” services, explaining to prospective clients how they used multiple accounts to evade detection on the public blockchain. The firm reportedly executed millions of dollars in wash trades, raking in tens of millions of dollars in payments from clients.

Robo Inu and Saitama Connections

As part of the plea agreement, Gotbit admitted to engaging in manipulative trading practices to inflate the prices and trading volumes of tokens for specific clients, including Robo Inu and Saitama. Notably, leaders of these cryptocurrency companies were also charged in separate cases unsealed in October 2024, suggesting a broader crackdown on market manipulation within the cryptocurrency sphere.This coordinated action by law enforcement sends a strong message to those who seek to exploit the digital asset market.

Financial Penalties and Cease of Operations

The consequences for Gotbit are significant. As part of the criminal resolution, the company agreed to cease all operations and forfeit approximately $23 million in seized cryptocurrency. This forfeiture represents a significant blow to the company and serves as a deterrent to others contemplating similar fraudulent activities.

Andriunin faces a potential prison sentence. Under the plea agreement with Andriunin, the government will recommend a sentence of up to two years in prison, highlighting the seriousness with which the U.S. justice system views market manipulation in the cryptocurrency space.

A Pattern of Market Maker Misconduct

The Gotbit case is not an isolated incident. The Justice Department has been actively pursuing market makers engaged in wash trading and other manipulative practices. Gotbit is the third market maker to resolve criminal charges relating to wash trading in the cryptocurrency industry.

In October 2024, the founder of MyTrade pleaded guilty in connection with providing an unlawful wash trading service that was identified through an undercover law enforcement operation. Similarly,in January 2025,CLS Global FZC LLC pleaded guilty in connection with offering illegal “volume support” services uncovered by the same operation. These cases demonstrate a concerted effort by law enforcement to target and dismantle fraudulent schemes within the cryptocurrency market.

The SEC, in parallel, has also brought a related civil enforcement action against Gotbit, alleging violations of securities laws. This dual-pronged approach – criminal prosecution and civil enforcement – underscores the government’s commitment to holding wrongdoers accountable and protecting investors.

Legal Ramifications and Potential Sentences

The charges against Gotbit and Andriunin carry significant penalties. wire fraud carries a sentence of up to 20 years in prison, up to three years of supervised release, a fine of up to $250,000 or twice the gross gain or loss from the offence, restitution, and forfeiture. Conspiracy to commit market manipulation and wire fraud carries a sentence of up to five years in prison, up to three years of supervised release, a fine of up to $250,000 to twice the gross gain or loss from the offense, restitution, and forfeiture. The specific sentence will be determined by a federal district court judge,based on the U.S. Sentencing Guidelines and statutes.

The case serves as a stark reminder that the U.S. justice system takes market manipulation seriously, irrespective of whether it occurs in conventional financial markets or the emerging cryptocurrency space.

Government cooperation and Ongoing Inquiry

The investigation and prosecution of Gotbit and Andriunin involved significant cooperation between various U.S. government agencies and international partners. The FBI’s Legal Attaché in Madrid, as well as Portugal’s Policia Judiciaria and Procuraduría General de la República, provided valuable assistance. The Justice Department’s Office of International Affairs played a critical role in coordinating with portuguese authorities to secure Andriunin’s arrest and extradition.

The investigation is ongoing, and the remaining defendants, Fedor Kedrov and Qawi Jalili, are presumed innocent until proven guilty beyond a reasonable doubt in a court of law.

Analyzing the Impact on the Crypto Market

The Gotbit case sends a chilling message to other potential market manipulators in the crypto space. By successfully prosecuting Andriunin and Gotbit, the U.S. government is demonstrating its commitment to cracking down on fraudulent activities and protecting investors. This increased scrutiny could lead to a more stable and trustworthy market habitat in the long run.

However, the case also raises concerns about the complexity of regulating the decentralized crypto market. Wash trading and other forms of market manipulation are tough to detect and prosecute, especially when they involve international actors and complex financial transactions. As the crypto market continues to evolve, regulators will need to adapt their strategies to keep pace with emerging threats.

The enforcement actions against Gotbit and similar firms underscore the need for improved investor education.Many individuals are drawn to the crypto market by the promise of high returns, but they may not fully understand the risks involved. By providing clear and accessible information about market manipulation and other fraudulent schemes, regulators can empower investors to make more informed decisions.

Practical Applications for Investors

Investors in the cryptocurrency market can take several steps to protect themselves from fraud and market manipulation.

• Do Your Research: Before investing in any cryptocurrency, thoroughly research the project, the team behind it, and the market dynamics. Be wary of projects that promise unrealistic returns or lack clarity.
• diversify Your Portfolio: Don’t put all your eggs in one basket. Diversify your crypto holdings across different projects and asset classes to reduce your overall risk.
• Use Reputable Exchanges: Choose well-established and regulated cryptocurrency exchanges. These platforms are more likely to have robust security measures and compliance programs.
• Be Skeptical of “Pump and Dump” Schemes: Be cautious of online communities or social media groups that promote specific cryptocurrencies with the goal of artificially inflating their price. These “pump and dump” schemes often leave unsuspecting investors with significant losses.
• Report Suspicious Activity: If you suspect that you have been a victim of fraud or market manipulation,report it to the relevant authorities,such as the SEC or the FBI.

Recent Developments and Future Implications

The Gotbit case is just one piece of a larger puzzle. The U.S. government is actively working to develop a comprehensive regulatory framework for the cryptocurrency market. This framework is expected to address issues such as market manipulation, investor protection, and money laundering.

The outcome of the Gotbit case and similar prosecutions will likely influence the future trajectory of the cryptocurrency market.By holding wrongdoers accountable and establishing clear rules of the road, regulators can foster a more stable and trustworthy environment that encourages innovation and investment.

As the crypto market continues to mature, it is essential that regulators, industry participants, and investors work together to create a safe and transparent ecosystem. Only then can the full potential of this transformative technology be realized.

Penalties for Wire Fraud and Conspiracy

A breakdown of the sentencing guidelines for the charges in this case.

Charge	maximum Prison Sentence	Supervised release	Fine	Restitution & Forfeiture
Wire Fraud	20 years	Up to 3 years	$250,000 or twice the gross gain/loss	Yes
Conspiracy to Commit Market Manipulation and Wire Fraud	5 years	Up to 3 years	$250,000 or twice the gross gain/loss	Yes

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Crypto Market Manipulation: An Interview with Dr. Anya Sharma, Fintech Regulatory Analyst

Archyde News – Following the recent guilty plea of Gotbit’s founder, we spoke with leading financial regulation expert, Dr. Anya Sharma, for her insights.

Archyde News: Dr. Sharma,thank you for joining us. The Gotbit case, involving market manipulation of cryptocurrencies, has sent shockwaves through the industry. Can you give our readers a swift overview?

Dr. Sharma: Certainly. Gotbit, a so-called “market maker,” admitted to manipulating trading volumes for cryptocurrency companies. They used techniques, like “wash trading,” to artificially inflate the perceived interest in various cryptocurrencies, including Robo Inu and Saitama. This gives a false impression of demand and can mislead investors, leading to potential losses.

Archyde News: The founder, Aleksei Andriunin, is facing potential jail time and Gotbit is forfeiting a notable sum. What does this signal to the cryptocurrency industry?

Dr. Sharma: It’s a clear message: the U.S. government is serious about cracking down on market manipulation in the crypto space. This case, along with the recent pleas from MyTrade and CLS Global, demonstrates a pattern. It’s a deterrent and indicates increased scrutiny from regulatory bodies like the SEC.

Archyde news: Gotbit mentioned having clients both in the U.S. and internationally. How does the international aspect complicate investigations and enforcement?

Dr. Sharma: It’s a major challenge. International cooperation is essential, as seen in Andriunin’s extradition from Portugal.Different jurisdictions have varying regulations, and coordinating investigations across borders can be complex and time-consuming. Though,it’s crucial to protect investors,and these collaborations are becoming more common.

Archyde News: Investor education is a key factor.What steps can everyday crypto investors take to protect themselves from these types of scams?

Dr. Sharma: The key advice remains: Do your research. Understand the projects you’re investing in. diversify your portfolio across different cryptocurrencies and asset classes. Stick to reputable, regulated exchanges. Be wary of “pump and dump” schemes and, if something seems too good to be true, it probably is. And always report suspicious activity.

Archyde News: Looking ahead, how do you see this case influencing future regulations in the cryptocurrency space?

Dr. sharma: We’ll likely see a push for a more comprehensive regulatory framework. This includes stronger surveillance of market makers, clearer guidelines on what constitutes market manipulation, and greater enforcement capabilities.The government will continue to look into the issues of investor security in relation to cryptocurrency.

Archyde News: Final question: The decentralized nature of crypto is often touted. does that inherent characteristic make regulation inherently more complex than in traditional finance? And what strategies are best to combat the issues now that cryptos are evolving?

Dr. Sharma: Absolutely. The decentralized aspect adds complexity.Transactions are recorded on a public blockchain, which can be difficult to trace, especially when it involves international stakeholders. However, this can also be an prospect: blockchain analysis tools are becoming increasingly refined, and as regulators and law enforcement become more comfortable and adept with these systems, there will be room for increased transparency. To combat current issues, all entities must work together to develop best practice suggestions, that would allow investors an opportunity to be safe in their actions, while ensuring that crypto continues to provide chances for innovation.