BTC-e Spreads 10,000 Mt. Gox BTC Across Exchanges and Wallets

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  • BTC-e, the exchange that received much of the stolen Mt. Gox bitcoin, has moved 10,000 of them
  • The haul was sent to exchanges and personal wallets
  • BTC-e was shut down in 2017 but retained a large amount of Mt. Gox bitcoin

BTC-e, the exchange that received a large amount of the stolen Mt. Gox bitcoin in 2014, recently moved 10,000 BTC, worth $165 million, to a variety of personal wallets, exchanges, and other services. Chainalysis spotted the mass move earlier this week and flagged it as proceeds of crime, given that it came from wallets held by Mt. Gox, which had 850,000 BTC stolen from it in the months leading up to its collapse in February 2014. However, the mass move doesn’t necessarily mean a huge sell is on the way, with most sent to personal wallets.

Money Flows Lead to Russia

BTC-e was shut down in July 2017 following the arrest of staff members and the seizure of server equipment at one of its data centres. At the time of the closure, BTC-e still held a substantial amount of bitcoin, 30,000 out which it moved to the now-sanctioned OTC desk Suex.

Since then, those behind the BTC-e wallets have occasionally moved small amounts of bitcoin to other destinations, with Russia and other Eastern European countries being the typical destination of the funds once sold.

Vast Majority Still in Personal Wallets

The $165 million withdrawal is the biggest from BTC-e wallets since April of 2018, but it in fact began withdrawing funds from this wallet nearly a month ago, testing the waters with smaller withdrawals to Webmoney, a Russian electronic payments service that supports cryptocurrencies.

Of the 10,000+ sent in the last several days, over 99% remains in personal wallets, while the rest was moved through a series of intermediaries to four addresses over two large exchanges. Chainalysis suggests that one of these is a Russian exchange which may have served as an intermediary to launder this BTC-e money.

The founder of BTC-e, Alexandr Vinnik, is currently awaiting trial in the U.S. on money laundering charges having been released early from his stay in a French prison on similar charges.