Gotbit CEO Faces Prison as $23M Wash-Trading Scandal Unravels—SEC Lawsuit Looms

Crypto''s latest cautionary tale: Gotbit''s house of cards collapses.

When the bots trade with themselves—and everyone loses

The CEO of crypto market maker Gotbit is trading his suit for stripes after regulators uncovered a $23 million wash-trading scheme. The SEC''s civil complaint—expected any day now—could become the blueprint for cracking down on fake volume.

How the scheme worked (until it didn''t)

Gotbit allegedly ran a classic pump-and-dump—using coordinated bots to create artificial demand, then cashing out while retail investors held the bag. The DOJ''s criminal case moved faster than a memecoin rally, securing a guilty plea while the SEC was still drafting its paperwork.

The compliance paradox

Ironically, Gotbit had positioned itself as a ''white hat'' market maker—the kind of firm exchanges hire to provide ''healthy liquidity.'' Turns out their order books were about as genuine as a BitMEX resume.

As one sardonic trader put it: ''Another day, another crypto firm discovering that printed profits don''t cash out well in federal court.''

Gotbit Ordered to Cease Operations After Fraud Conviction

The sentencing took place in Boston, where U.S. District Court Judge Angel Kelley also ordered one year of supervised release for Andriunin. He was arrested in Portugal in October 2024 and extradited to the United States in February 2025.

Gotbit Consulting LLC, which was widely known in the crypto industry as a market maker, received five years of probation. The company was also ordered to forfeit approximately $23 million in seized cryptocurrency. As part of the sentence, the firm will cease operations.

As a result of an #FBI Boston investigation, Gotbit Consulting, a financial services firm known in the crypto industry as a “market maker,” & its founder Aleksei Andriunin, of Russia & Portugal, were sentenced for market manipulation & fraud conspiracy. https://t.co/CNpz0BD4aE pic.twitter.com/jIFg1Z3nt6

Prosecutors said that between 2018 and 2024, Gotbit manipulated cryptocurrency trading volumes to give the appearance of active markets.

The firm marketed these services to crypto companies seeking listings on major platforms, including CoinMarketCap and centralized exchanges.

Gotbit founder was involved in “a wide-ranging conspiracy” to manipulate crypto markets on behalf of client companies.#CryptoFraud #Gotbit #USDOJhttps://t.co/nP4lEodLky

In a 2019 interview, Andriunin openly described how he developed algorithms to carry out wash trades, essentially buying and selling the same asset to inflate volume and influence token listings.

Court documents revealed that Gotbit’s team used multiple wallets to mask these trades on public blockchains, making detection more difficult.

“Gotbit’s activities were designed to deceive both investors and market platforms by fabricating the appearance of active trading,” said U.S. Attorney Leah Foley. “This sentencing holds them accountable and sends a message to others in the industry.”

Gotbit admitted to manipulating the token prices and volumes of several clients, including Robo Inu and Saitama, whose executives were charged in separate cases unsealed last year.

Aleksei Andriunin, the founder of Gotbit, has been extradited to the United States, where he faces charges of market manipulation.#Gotbit #Fraudhttps://t.co/zEt7STILTA

The scheme allowed the firm to collect tens of millions of dollars in fees from crypto projects seeking attention and legitimacy. Executives from those companies face separate criminal charges unsealed last year.

The Department of Justice named two other Gotbit executives, Fedor Kedrov and Qawi Jalili, in an October 2024 indictment. Both remain charged in the ongoing case.

Gotbit Case Tied to Broader Wash Trading Crackdown

The Gotbit case is the latest in a string of federal actions targeting wash trading in the crypto market.

Following the criminal sentencing of Gotbit’s CEO and the firm’s shutdown, the U.S. Securities and Exchange Commission filed a civil suit against the company for violating securities laws.

It’s the third major enforcement case against a crypto market maker in recent months, preceded by similar actions against MyTrade in October 2024 and CLS Global in April 2025.

All three were uncovered through a sweeping undercover operation led by the FBI’s Boston Division.

Acting special agent Kimberly Milka said the agency remains committed to “pursuing those who manipulate markets for profit.”

Federal prosecutors charged 15 people and multiple firms, including Gotbit, ZM Quant, and CLS Global, with market manipulation in late 2024.

SEC cracks down on UAE-based CLS Global for crypto wash trading, imposing $425K+ penalties and banning U.S. operations in market manipulation case.#CryptoRegulation #SEChttps://t.co/eBMw9cROza

The crackdown resulted in four arrests, five plea deals, and over $25 million in crypto asset seizures.

In April, CLS Global was fined over $428,000 and barred from operating in the U.S. for three years.

Wash trading, where a trader buys and sells the same asset to inflate volume, remains a widespread issue.

Chainalysis estimates at least $2.6 billion in wash-traded volume across the crypto market, with some studies suggesting the actual figure could be far higher.