The Department of Justice has recently indicted Aleksei Andriunin, the CEO of Gotbit, a crypto financial services firm, on charges of wire fraud and conspiracy to commit market manipulation. Andriunin, a Russian national living in Portugal, is accused of orchestrating a scheme to artificially boost trading volumes for client crypto companies, including those in the US. He was arrested on Oct. 16.
Gotbit, which promoted itself as a “meme coin market maker,” allegedly utilized “wash trading” techniques from 2018 to 2024 to manipulate market activity. This enabled cryptocurrencies to secure listings on platforms like CoinMarketCap and major exchanges. Memecoins, based on internet memes, often see rapid value increases but can also experience sharp declines, a trend that Gotbit reportedly took advantage of to attract new clients.
Court documents reveal that Andriunin developed software specifically for conducting wash trades, creating misleading trading activity to deceive investors and exchanges. Gotbit’s employees allegedly marketed these services to clients, emphasizing their methods for avoiding detection on public blockchains. The company is said to have facilitated millions of dollars in wash trades and made tens of millions from these practices, with Andriunin purportedly transferring significant sums to his personal Binance account.
The charges against Gotbit also point to the firm’s involvement in targeting memecoin investors through “pump and dump” schemes. These schemes involved inflating a token’s trading volume to attract investors before selling off holdings at a profit, often leaving investors with losses. Prosecutors referenced Operation Token Mirrors, a DOJ investigation utilizing a fake digital token to observe manipulation tactics, as part of the evidence in this case.
If convicted, Andriunin could face up to 20 years in prison for wire fraud, along with fines, restitution, and forfeiture. The conspiracy charge carries a maximum sentence of five years, with sentencing to be determined by a federal judge based on the U.S. Sentencing Guidelines. This indictment sheds light on the alleged deceptive practices within the cryptocurrency market and underscores the importance of regulatory oversight to protect investors from such schemes.