The Justice Department has indicted Aleksei Andriunin, founder and CEO of crypto financial services company Gotbit, with wire fraud and conspiracy to commit market manipulation.
Andriunin, a Russian national residing in Portugal, allegedly orchestrated a scheme to artificially inflate trading volumes for crypto client companies, including several based in the United States. He was arrested on October 16.
The indictment, filed in the District of Massachusetts, also charges Gotbit and two of its directors, Qawi Jalili and Fedor Kedrov, who were named in a previous indictment unsealed earlier this month.
Prosecutors allege that Gotbit, which presented itself as a “meme coin market maker,” used “wash trading” techniques from 2018 to 2024 to manipulate market activity, allowing cryptocurrencies to obtain listings on platforms like CoinMarketCap and major exchanges.
Memecoins, often based on Internet memes, can quickly appreciate in value but tend to experience sharp declines, a trend that Gotbit has reportedly exploited to attract new customers.
Court documents claim that Andriunin developed software specifically designed to make fictitious trades, creating a deceptive trading activity to deceive investors and stock exchanges. The indictment also alleges that Gotbit employees marketed these services to their customers, highlighting their methods of evading detection on public blockchains.
Gotbit allegedly facilitated millions of dollars in fictitious transactions and made tens of millions through these practices, Andriunin allegedly transferred large sums to his personal Binance account.
The charges also highlight Gotbit’s role in targeting memecoin investors through what prosecutors describe as “pump and dump” schemes. These schemes involved inflating a token’s trading volume to attract investors before selling the holdings at a profit, often leaving investors at a loss.
Prosecutors cited Operation Token Mirrors, a DOJ investigation that involved the creation of a fake digital token to observe manipulation tactics, as part of evidence collected in the case.
If convicted, Andriunin faces up to 20 years in prison for wire fraud, in addition to fines, restitution and forfeiture. The conspiracy charge carries a maximum sentence of five years. The sentence would be determined by a federal judge based on U.S. sentencing guidelines.
