Roman Sterlingov, a Russia and Sweden dual national, is convicted by a U.S. federal jury for operating Bitcoin Fog, an extensive hub for laundering bitcoin on the darknet. Operating from 2011 to 2021, the platform is said to have assisted in laundering over $336 million in Bitcoins.
Reports from authorities suggest that a significant number of transactions were linked to illegal activities, including drug deals, hacking, and identity theft. Bitcoin Fog employed a “mixing” or “tumbling” technique, complicating source tracing of the cryptocurrency and promoting its anonymity.
Despite Sterlingov’s efforts to preserve anonymity, advanced law enforcement tools were able to trace back the illegal activities to him, marking a significant victory for global law enforcement agencies fighting against darknet crimes.
Bitcoin Fog is accused of processing more than 1.2 million bitcoins, totaling around $400 million. Yet, the role and impact of Bitcoin Fog in the cryptocurrency market remain unproven and require full verification.
According to Deputy Attorney General, Lisa Monaco, Bitcoin Fog utilised internet anonymity to launder considerable amounts of bitcoin. This operation not only concealed illegal activities but also posed a significant challenge for law enforcement agencies. Sterlingov faces a maximum penalty of 20 years for each money laundering count but insists that he was merely a Bitcoin Fog user and not its creator.
Sterlingov’s denial of his control over Bitcoin Fog operations and his claim of being just a platform consumer is yet to convince the law enforcement. His persistent claims of innocence could potentially lead to substantial prison time if found guilty on multiple charges.
Meanwhile, the DOJ argues that Bitcoin Fog facilitated illegal activities by charging a fee for blending bitcoins. These blended bitcoins were then spread in a manner designed to obscure their traceability back to any criminal activities. Sterlingov’s lawyer plans to appeal against the verdict, questioning the legitimacy of the DOJ’s tracking methods and the chosen jurisdiction for prosecution.
