At the FBI's request, Gotbit CEO Alexey Andryunin was detained in Portugal and is currently awaiting deportation to the United States to face legal proceedings. An investigation is underway into Gotbit Hedge Fund, a market maker for the Hamster Kombat ($HMSTR) token. Investors were alarmed when $HMSTR's price fell 12% in the following day following the arrest.
Gotbit, ZM Quant, and CLS Global are among the 16 businesses and a number of individuals that the US Department of Justice has charged with being part of a cryptocurrency fraud operation. Four arrests, six plea agreements, and the seizure of more than $30 million in bitcoin have resulted from the investigation thus far.
The FBI looked into fraudulent activities in the market utilizing NexFundAI, an Ethereum-based cryptocurrency. Under the guise of a fictitious initiative, they addressed market makers and discovered how these companies were manipulating trading volumes and markets through the use of multiple wallets and fictitious transactions—a practice known as "wash trading."
Serious accusations have been brought against individuals responsible for these actions. They might spend up to 25 years in prison if proven guilty of manipulating the market. This case serves as a reminder of the dangers associated with cryptocurrencies and the repercussions of engaging in illicit activity.
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