Gotbit allegedly exploited meme-based cryptocurrency trends through artificial trading to deceive investors and platforms.
The Department of Justice has charged Aleksei Andriunin, founder and CEO of the crypto financial services firm Gotbit, with wire fraud and conspiracy to commit market manipulation.
Andriunin, a Russian national living in Portugal, is accused of orchestrating a scheme to artificially inflate trading volumes for client crypto companies, including some based in the United States. He was apprehended on October 16.
The indictment, filed in Massachusetts, also names Gotbit and two of its directors, Qawi Jalili and Fedor Kedrov, who were previously charged in an earlier indictment unsealed this month.
According to prosecutors, Gotbit, which promoted itself as a “meme coin market maker,” engaged in “wash trading” tactics from 2018 to 2024 to manipulate market activity, helping cryptocurrencies achieve listings on platforms like CoinMarketCap and major exchanges.
Memecoins, inspired by internet memes, often surge in value but can also rapidly decline. Gotbit allegedly took advantage of this volatility to attract clients.
The court documents allege that Andriunin developed software to automate wash trades, creating fake trading volume to deceive investors and exchanges. Prosecutors also claim Gotbit’s employees marketed these services to clients, detailing methods to avoid detection on public blockchains.
Reports indicate Gotbit facilitated millions of dollars in wash trades, profiting tens of millions, with Andriunin allegedly transferring large sums into his personal Binance account.
The indictment further details Gotbit’s alleged involvement in “pump and dump” schemes, where a token’s trading volume is artificially boosted to attract investors, followed by a quick sell-off, leaving many investors at a loss.
Prosecutors referenced Operation Token Mirrors, a DOJ investigation that created a fake digital token to observe manipulation strategies, as part of the evidence collected in this case.
If convicted, Andriunin faces up to 20 years in prison for wire fraud, along with potential fines, restitution, and asset forfeiture. The conspiracy charge could add an additional five years to his sentence, with final sentencing determined by a federal judge under U.S. Sentencing Guidelines.