Polish Authorities Arrest Russian ‘Crypto King’ Linked To WEX Exchange $450 Million Collapse

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As a seasoned analyst with over two decades of experience in financial crime and cybersecurity, I’ve seen my fair share of crypto-related scams and fraudsters. The recent detention of Dmitry Vasiliev, the so-called “Crypto King,” by Polish authorities is yet another example of the wild west that is the cryptocurrency world.

A Russian national suspected of fraud and money laundering, connected to the failed cryptocurrency exchange WEX, was apprehended by Polish police. American officials have requested his extradition for alleged crypto-related offenses and are now waiting for the extradition proceedings to be finalized.

WEX’s ‘Crypto King’ Detained In Poland

On Friday, it was reported by local news sources that Polish authorities apprehended a 37-year-old Russian national in Warsaw. The individual in question is believed to be Dmitry Vasiliev, who served as the CEO of WEX crypto exchange and hails from Belarus. However, due to Polish regulations, he was referred to in these reports as “Dmitry V.

Vasiliev was arrested by the “Shadow Hunters,” an elite unit of the Central Bureau of Police Investigation (CBŚP), at an apartment in the Wola district, Krzysztof Wrześniowski, a CBŚP’s spokesperson, revealed.

Wrześniowski pointed out that the detention was initiated following an order from the Warsaw District Prosecutor’s Office, who were responding to a request for extradition from the U.S. Department of Justice. He further stated that Dmitry V. is allegedly involved in multiple fraud cases, international money transfers, and cryptocurrency exchange money laundering, as he was running one of the biggest global cryptocurrency exchanges.

It’s important to mention that Vasiliev was apprehended in Poland during August 2021. The individual was caught at Warsaw’s Chopin Airport based on a demand from Kazakhstan for his extradition due to crypto-related offenses. However, he was released from custody after a short period and subsequently went back to Russia.

The Polish authorities showed concern about Vasiliev managing to enter the country unnoticed and remain hidden for such a long time, implying that he likely kept a low profile in order to avoid legal scrutiny.

Currently, the individual known as the “crypto king” is confronting a fresh extradition demand from the United States, seeking to prosecute him for his suspected wrongdoings. If he’s successfully extradited, Vasiliev potentially faces imprisonment of up to 20 years, according to Wrześniowski.

The man is being held, waiting for the full process regarding his transfer to the United States to be completed.

The $450 Million WEX Collapse

According to various news sources, it is said that Vasiliev served as the head of World Exchange Services (WEX) until its demise in 2018. WEX was established with the intention of replacing the defunct BTC-e cryptocurrency exchange, which closed down following an FBI investigation into international money laundering and the concealment of stolen funds from Mt. Gox.

According to a BBC report from 2019, although Vasiliev served as the public face, WEX was actually controlled behind the scenes by Alexey Bilyuchenko. It’s important to note that Bilyuchenko was associated with Alexander Vinnik in the now-defunct BTC-e exchange.

Following the demise of BTC-e, he assisted WEX with backing from millionaire Konstantin Malofeyev. Unfortunately, the platform suffered a crash the following year as the reported $450 million in customer funds disappeared. As per BBC reports, Bilyuchenko admitted that he had relinquished control of the exchange in the spring of 2018 after being deceived by supposed security service agents.

In a gathering with Malofeyev and individuals he referred to as agents, the suspect stated that he was advised or instructed to transfer the funds to a wallet managed by the Russian Federal Security Service (FSB). Furthermore, he asserted that Malofeyev’s companions deceived him in some manner.

As an analyst, I must clarify that despite allegations linking me to the Kremlin and various financial crimes, such as my involvement with the BTC-e case, the WEX collapse, and the Mt. Gox hack, I personally deny these accusations. My initial evasion of US detention in relation to the BTC-e case was followed by an arrest by Russian authorities due to the WEX collapse incident in 2022. In 2023, charges were brought against me by American authorities for my part in the operations of the BTC-e exchange and the Mt. Gox hack. However, I maintain my innocence regarding these matters.

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2024-12-07 14:12