Bitzlato Stops Bitcoin Withdrawals Amid Co-Founders’s Guilty Plea
Bitzlato halts Bitcoin withdrawals after co-founder's guilty plea, users face uncertain future amid legal issues.
After Bitzlato co-founder, Anatoly Legkodymov, admitted to illegal operations and agreed to shut down the exchange, the exchange has also stopped its Bitcoin withdrawals.
Legkodymov made a plea in Brooklyn court which led to a $23 million crypto forfeiture. His arrest was part of a U.S. and French law enforcement operation, resulting in Bitzlato's website being seized.
Despite these troubles, Bitzlato managed to return some user funds. Starting in March, users could withdraw 50% of their assets via a Telegram bot, which later increased to 70%.
U.S. Attorney Breon Peace criticized Bitzlato for aiding criminal activities. The Department of Justice linked Bitzlato to the Hydra darknet market, accusing it of facilitating money laundering, including for ransomware profits.
Bitzlato's users face uncertainty with the temporary stop on Bitcoin withdrawals. They have already endured a turbulent time with their funds, from asset seizure to partial restoration. The legal case's outcome will decide what happens to their assets.
