Cryptocurrency launderer Roman Sterlingov, who ran Bitcoin Fog, was accused of “hiding his identity in the fog” by creating an online service to mix tokens from different owners to make transactions harder to trace. It was the first step in a trial that began in federal court in Washington, prosecutor Christopher Brown said.
Brown alleged that Sterlingov used his platform to siphon tens of millions of dollars from darknet markets where illegal drugs are primarily traded. Sterling took steps to keep his role in starting the mixer secret to avoid prosecution, Brown added.
However, Sterlingov’s lawyer, Thor Ekeland, argued that the government’s evidence did not exist, noting the lack of witness statements or server logs to support the allegations. He stated that there is no evidence that Sterling ever used Bitcoin Fog.
Sterlingov, who has been in custody for almost three years, maintains his innocence and is ready to fight the charges. His defense includes an attack on the firm Chainaanalysis, which the government often hires to track cryptocurrency flows in money laundering cases.
Prosecutors said the Bitcoin Fog mixer processed more than $400 million in untraceable transactions, including funds associated with darknet markets over the past ten years. Ekeland, by contrast, argues that Sterlingov never had any involvement in child pornography or darknet markets and that the allegations are not supported by evidence.
The lawsuit shows how law enforcement continues to combat criminal activity in the cryptocurrency space, and how technologies such as Chaina analysis are used to uncover crimes and culprits.
