Aleksei Andriunin, the Russian-born founder and CEO of the crypto hedge fund and market maker Gotbit, has been sentenced to eight months in prison for orchestrating a large-scale wash trading scheme. The sentence corresponds to time already served following his arrest in Portugal and subsequent extradition to the United States. He pleaded guilty to charges related to market manipulation and wire fraud connected to faking trading volumes of digital tokens from 2018 to 2024.
Gotbit systematically faked trading volumes to inflate the apparent liquidity and visibility of client tokens, helping projects secure exchange listings and generate investor hype. Prosecutors revealed that Andriunin developed automated code to facilitate these fraudulent trades while hiding the activity across numerous accounts and blockchain records. The operation generated tens of millions of dollars in fraudulent revenues and misled the crypto market.
As part of the plea deal, Gotbit must forfeit $23 million in cryptocurrencies, suspend all operations for five years, and Andriunin faces one year of supervised release with conditions to abstain from crypto markets. Two directors of Gotbit, Fedor Kedrov and Qawi Jalili, are also charged as part of the ongoing federal crackdown on crypto market manipulation.
The case was initiated under "Operation Token Mirrors," where the FBI created a digital "trap token," NexFundAI (NEXF), to expose fraudulent wash trading activities. This prosecution is part of a broader wave of enforcement against illegal market practices by crypto firms, including other entities like MyTrade and CLS Global. The U.S. Department of Justice and Securities and Exchange Commission are seeking long-term penalties and restrictions to enforce market transparency and protect investors from deceptive token activity.