Greek Court Approves US Extradition of BTC-e Operator In $4 Billion Money Laundering Case

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A Greek court has approved the U.S. extradition of a 38-year-old Russian national accused of laundering more than $4 billion in bitcoin for culprits involved in hacking attacks, tax fraud and drug trafficking with the help of the now-defunct BTC-e exchange.

Alexander Vinnik, an alleged operator of BTC-e—a digital currency exchange service that has been in operation since 2011 but seized by the authorities right after Vinnik’s arrest in a beachside village in northern Greece in late July 2016 at the request of US law enforcement authorities.

Since his arrest, Moscow has also requested Vinnik be returned home, as it has previously done with other Russian nationals wanted by the United States.

However, the Greek court ruled Wednesday (4 October) to extradite Vinnik to the U.S., where he will face trial on the charges with the operation of an unlicensed money service business, money laundering, conspiracy to commit money laundering, and engaging in unlawful monetary transactions.

U.S. authorities suspect Vinnik was the one responsible for facilitating crimes ranging from computer hacking to drug trafficking since at least 2011 through his digital Bitcoin exchange.

U.S. authorities also linked the accused to the failure of the once-very popular Japanese bitcoin exchange Mt. Gox, which was shut down in 2014 following a massive series of mysterious robberies, which totalled at least $375 million in Bitcoin.

The authorities believe Vinnik “obtained” funds from the hacker or insider who stole bitcoins from Mt. Gox and sent them to a bitcoin wallet controlled by Vinnik, who intentionally laundered them through BTC-e, over a period of three years.


“After the coins entered Vinnik’s wallets, most were moved to BTC-e and presumably sold off or laundered (BTC-e money codes were a popular choice). In total some 300,000 BTC ended up on BTC-e,” according to WizSec, a Japanese security firm that has long been investigating the Mt. Gox case.

“To be clear, this investigation turned up evidence to identify Vinnik not as a hacker/thief but as a money launderer; his arrest news also suggests this is what he is being suspected for. He may have merely bought cheap coins from thieves and offered a laundering service.”

While Greek police described Vinnik as “an internationally sought ‘mastermind’ of a crime organisation,” United States authorities accused him of facilitating crimes including hacking, identity theft, tax refund fraud, public corruption and drug trafficking.

Soon after the Greek court decision, Vinnik’s lawyers appealed to the Supreme Court.

“We have taken immediate action and appealed the ruling, and the case will be examined by the criminal division of the Supreme Court,” Vinnik’s lawyer, Alexandros Lykourezos, said, as quoted by The News Tribune.

If extradited to the United States, Vinnik faces up to 55 years in prison, along with a $500,000 fine or twice the value of the property involved in the transaction for each count.

However, he has denied all charges against him, saying he was just a technical consultant to BTC-e and not its operator.

“I have nothing to do with what I am accused of,” he told the judges.

Vinnik also claimed that the laptop seized by the Greek authorities during his arrest was in no way related to his job, adding that it only contained children’s cartoons for his family.

Vinnik is trying to return to his home in Russia, where he is facing lesser fraud charges, although a hearing date for the Russian extradition request has not yet been set.

Source : THN

Coinbase and Shift Payments Introduce a Visa-branded Bitcoin Debit Card That Works Everywhere Visa is Accepted

Coinbase has introduced the first U.S.-issued bitcoin debit card, the Shift Card, in partnership with Shift Payments. The Shift Card is a Visa debit card that currently allows Coinbase users in 24 states to spend bitcoin both online and at physical points of sale at more than 38 million merchants worldwide.

“Merchant adoption has come a long way over the past few years, but it’s still difficult for people to make regular purchases with bitcoin,” notes the Coinbase announcement. “Buying gas at a local gas station or groceries at a neighborhood grocery store with bitcoin has not been possible in most cities in the U.S. Thanks to Shift Payments, it’s now possible to use bitcoin to buy gas, groceries, and much more. With the Shift Card, you can now spend bitcoin anywhere in the world that Visa is accepted.”

Coinbase users living in the states where the service is available can order a Shift debit card for $10 and link it to a Coinbase wallet. When the Shift debit card is used to make a purchase, the equivalent value of bitcoin (based on the current spot price of bitcoin on Coinbase) is debited from the user’s Coinbase bitcoin wallet. For certain transactions, such as gas purchases and dinner bills, Shift will debit more than the purchase amount, and refund the remainder to the user when the final payment amount is settled.

There are no annual fees, no bitcoin-to-dollar conversion fees, and no domestic transaction fees. Coinbase says there are no domestic transaction fees “for a limited time,” which seems to indicate that domestic transaction fees could be added in the future. There is a $2.50 ATM fee and a 3 percent international transaction fee. The daily ATM withdrawal limit is $200, and the default daily spending limit is $1,000.

The card isn’t available to users in New York, Florida, and many other states. Coinbase and Shift Payments say that they are working through legal and regulatory matters in the states where the Shift Card is not yet available.

Shift Payments wants to integrate all payment options available to a user in one debit card. Users can connect a Shift Card to multiple accounts to seamlessly spend all supported payment means, including digital currencies, with the same card.

“The Shift Card works like any debit card today,” notes the Shift website. “Connect your existing accounts and spend Coinbase or Dwolla, immediately and directly, everywhere Visa is accepted.”

The Shift card isn’t the first bitcoin debit card, but the availability of a Visa-branded bitcoin debit card from a major bitcoin exchange and wallet operator is likely to represent a quantum leap in the space.

“At the end of the day, what we’re trying to do is make bitcoin easy to use,” Coinbase vice president of business development and strategy Adam White, told Wired. “We want to make it easy to buy and sell bitcoin, and we want to make it easy to spend. A mainstream debit card based on bitcoin is a key element.”

Of course all U.S. bitcoin users already can spend their bitcoin by converting them to dollars and sending the dollars to their bank accounts, but the process is lengthy and probably overly complex for some users.

Therefore, the Shift Card is likely to make Bitcoin much more useful in daily life.

Wired notes that existing Coinbase customers are now likely to start spending more of their bitcoin, rather than just speculating, and new customers will be attracted to the digital currency because they can more easily spend it. Then, merchants will be more motivated to start accepting bitcoin, which could start a runaway feedback loop that will boost the Bitcoin ecosystem.

Source : Bitcoin Magazine