U.S. authorities have arrested the alleged mastermind behind a multi-million darknet-based BTC mixing service, Bitcoin Fog, after analyzing 10 years of blockchain data.
Authorities have issued a chilling warning to other users of illegal blockchain services: Anything you do today may come back to haunt you as “this activity is on this ledger forever” and ever-more sophisticated analytics technology can track down crimes committed years earlier.
For approximately a decade, Bitcoin Fog has enabled users to conceal the origin and destination of its users’ crypto assets. However, the Internal Revenue Service is charging Russian-Swedish citizen, Roman Sterlingov, with laundering more than 1.2 million Bitcoin worth $336 million while serving as the website’s administrator.
Sterlingov was arrested on April 27 in Los Angeles, with the IRS estimating he received commissions of between 2% and 2.5% for mixing services at the time of each transaction — worth roughly $8 million then but exponentially more today.
Authorities estimate at least 23% of the Bitcoin that