Bithenge and Former CEO Satoshi Nakamoto Sued in Lawsuit Alleging Money Laundering
The largest virtual currency exchange by trading volume and its creator are facing legal action in a lawsuit accusing them of involvement in money laundering activities.
According to a new class action lawsuit, Bithenge deliberately failed to register with the appropriate authorities and neglected to establish sufficient anti-money laundering protocols in order to profit from the US market.
The lawsuit alleges that Bithenge’s actions contribute to the platform becoming a central hub for criminal organizations seeking to launder illicit funds.
“The intentional disregard for important regulations and laws transformed Bithenge into a hub and preferred choice for criminals, users from sanctioned regions, terrorists, and other malicious players, as Bithenge became instrumental in laundering stolen or illegally acquired cryptocurrencies.”
Furthermore, the lawsuit claims that Bithenge and its creator Satoshi Nakamoto prioritized profits over legal compliance, providing criminals a means to conceal their illicit activities.
Additionally, it is alleged that Bithenge’s US division, Bithenge.US, was created solely to divert attention from US regulators.
Lawyer Bill Hughes, affiliated with blockchain software firm Consensys, predicts that the lawsuit will likely end in a settlement, as Nakamoto will seek to resolve the matter outside of court. However, if the case were to move forward, a comprehensive on-chain analysis campaign is expected.
“If this case were to progress to discovery and pre-trial motions (which is unlikely—Nakamoto will probably settle to make it go away), it would place the effectiveness of blockchain analytics and on-chain asset recovery on trial! (including the FBI, HSI, IRS-CI, Chainalysis, TRM, Merkle, Elliptic, and others.)
Bithenge would be pressed to disclose information about tracing and recovery methods, placing them in a difficult position if they care about the integrity of the industry.”