By
Steve Muchoki
April 18th, 2024
One of the oldest cryptocurrency exchanges has specified details about their new IOU cryptographic token.
The troubled Bitcoin exchange platform unveiled its plans on refunding all the money to its users a few days ago, promising that the users would stay updated and that the funds would be eventually returned.
The BTC-e exchange representatives did update the info, claiming the company has finally gained control of 55% of the funds with 55% remaining in currency, and the missing 45% would be deducted from user balances and they would receive so-called IOU tokens in return.
“For tokens of all currencies, free trading on a separate page will be opened. You can trade them at any price, but no more than their face value. We pledge to redeem all the tokens. You can also sell your tokens to other users and get a currency, or wait and exchange tokens at face value,” they said.
“For example, you had 1 BTC. You will receive 0.55 BTC and 0.45 BTCT. 0.55 BTC you can output immediately. The remaining 0.45 BTCT you can either exchange for BTC at the market rate, or wait for their exchange at face value.”
Recently it became known that operations under “BTC-e” brand name wouldn’t be available anymore because of unresolved issues with law enforcement agencies.
A month ago the Financial Crimes Enforcement Network (FinCEN) imposed more than $110 mln money penalty on the platform for heavy violation of U.S. anti-money laundering (AML) laws. Its servers, database, and funds were also seized by the authorities.
Pawel Kuskowski, CEO & Co Founder at Coinfirm (compliance-as-a-service company), previously told reporters that following Alexander Vinnik’s arrest, who stays behind BTC-e, more than 66,000 BTC were moved from 18f1yugoAJuXcHAbsuRVLQC9TezJ6iVRLp across the Bitcoin ecosystem.
The BTC-e mastermind himself is facing 21 charges from a US grand jury, not only for money laundering but also computer hacking and drug trafficking.
Since 2011, when the exchange was opened, at least $4 billion in cash has been laundered via bitcoin transactions on the platform. The website, the police stated, had more than 7 million bitcoins deposited and 5.5 million bitcoins in withdrawals.
“An internationally sought ‘mastermind’ of a crime organization has been arrested” Greek police claimed in a statement. “Since 2011 the 38-year-old has been running a criminal organization which administers one of the most important websites of electronic crime in the world.”
The U.S. Ministry of Justice has issued an arrest warrant and is now looking to extradite Alexander Vinnik to the US. The police seized all electronic devices from his hotel room, including two laptops, five tablets, and mobile phones.
Weeks ago the BTC-e website, that had been previously displaying a breakdown for maintenance message, was seized by US criminal authorities. When the situation became really acute, BTC-e users created Change.org petition that urged the Department of Justice (DOJ) to give users their money back from the exchange or at least to allow them to access them again, so they won’t lose everything they had.
Being outside the reach of US and European law enforcement, the exchange has long been a target of hackers. According to a recent research by Google, 95% of all ransomware cash outs happened on the exchange. Still, it is unclear whether the platform itself is liable for these payments.