Dump inbound? Rogue BTC-e sends $165 million in Bitcoin to personal wallets and exchanges


After almost a year of silence, bitcoin funds on rogue exchange BTC-e are on the rise again. Chainalysis is an American blockchain analytics company headquartered in New York City Report 10,000 BTC worth about $165 million have been moved.

Transaction destinations include personal wallets, bill of exchange addresses and other services. Notably, this transfer is the largest withdrawal since April 2018.

BTC-e was a crypto exchange founded in July 2011 and shut down in 2017 as a result of a joint investigation by the US Secret Service and the FBI. According to the allegations, BTC-e played a major role in money laundering for the ransomware attacks.

As NewsBTC reported, security researchers estimated that BTC-e was responsible for 95% of all ransomware payments and their conversion to fiat currencies.

Alexander Vinnik, a Russian national and co-founder of BTC-e, is also believed to have been involved in the theft of 530,000 of the more than 800,000 bitcoins stolen from Mt Gox. Vinnik was extradited to the US in August after two years in prison in France.

As Chainalysis points out, BTC-e still held a significant amount of bitcoin at the time of the 2017 halving. In April 2018, BTC-e transferred more than 30,000 bitcoins from its service wallet. Of this, about $50 million went to the now-approved OTC counter Suex.

BTC e-fraudsters about to dump their Bitcoin?

Since then, the masterminds of the fake exchange have been relatively quiet. According to Chainalysis, in October 2021 alone, BTC-e sent more than $6 million worth of bitcoin to more than 100 individual wallets and eventually to various exchanges “serving Russia and other Eastern European countries.”

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Yesterday’s transaction appears to be the tip of the iceberg and a long-planned move. BTC e-fraudsters started withdrawing the cryptocurrency just over a month ago. On October 26, both BTC-e and its successor WEX sent small amounts of bitcoin to Russian electronic payment service WebMoney.

Then, on November 11, BTC-e conducted a test by indirectly transferring 100 bitcoins to the exchange. After a seemingly successful run, BTC-e bounced back on yesterday’s big move.

BTC e-transaction as produced by Chainalysis. Image:

Chainalysis concluded that about 9,950 bitcoins were left in the fraudsters’ personal wallets, “while the rest was moved through a series of intermediaries to four deposit addresses on two major exchanges. In the case of Exchange 1, pictured above.” , our analysis suggests that a Russian exchange may have acted as a middleman to launder this BTC e-money.

Ki Young Joo, CEO of CryptoQuant, confirms that BTC comes from criminals linked to the Mt. Gox hack in 2014. “They sent 65 BTC to HitBTC a few hours ago, so it’s not a government auction or anything,” he added. Xu urged the exchange to suspend the account due to suspicious activity.

Thus, in the short term, BTC e-fraudsters do not appear to be a threat as they again only dump small amounts of BTC. Meanwhile, bitcoin price is struggling with a key resistance near $16,000 USD.

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Bitcoin is facing key resistance at $16,600 on the 15-minute chart. Source: TradingView




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