Gotbit founder extradited back to the US for market manipulation and fraud charges
The US extradited Aleksei andriunin, the founder of Gotbit to face charges for market manipulations and wire fraud conspiracy. The following is a statement by the spokesperson The US Attorney’s Office District Massachusetts
Andriunin, who was living in Portugal at the time, was arrested by Portuguese authorities on October 8, 2024. He appeared at federal court in Boston in February 25th, following his extradition. The judge ordered him to be held pending further hearing.
A federal grand jury in Boston, Massachusetts indicted Andriunin as well as Gotbit directors Fedor Kedelova and Qawi Jalili for wire fraud and conspiracy of market manipulation and fraud by wire.
Market manipulation
According to court documents, Gotbit allegedly operated as a “market maker” in the crypto industry, providing market manipulation services between 2018 and 2024.
Andriunin allegedly created software to facilitate “wash trading,” a practice that artificially inflates trading volumes. This tactic allowed projects to gain listings on data aggregators like CoinMarketCap, and access to larger exchanges.
Investigators claim that Gotbit employees Jalili, Kedrov and others promoted these strategies to clients, and used multiple accounts in order to hide the wash trading to blockchain observers.
Gotbit generated tens and millions of dollars in fraudulent revenue. The authorities accuse Andriunin that he transferred a portion into his Binance account.
Andriunin could face up to 20-years in prison if convicted of wire fraud, and up to 5-years for conspiracy to commit wire fraud and market manipulation. Andriunin could face fines up to $250,000. This is the amount of the gross gain from the crimes, plus the double.
Artificial trading volume
On Oct. 15, 2024, the US Securities and Exchange Commission filed fraud charges against Gotbit and Fedor Kedrov.
The SEC alleged that the platform used a scheme to manipulate the market for “Robo Inu,” a crypto asset marketed as a security to retail investors.
According to the SEC complaint crypto asset promoter VyPham hired Gotbit in order to create artificial trading volume for Robo Inu. Gotbit is accused of using wash trading to create fake trading activity on trading platforms.
Investigators say the firm fabricated over $1,000,000 of artificial trading volume per day using automated trading algorithms.
