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Russian FSB Nabs Blum Crypto Co-Founder in Fraud Crackdown—Another ’Trustless’ System Proves All Too Trusting

Russian FSB Nabs Blum Crypto Co-Founder in Fraud Crackdown—Another ’Trustless’ System Proves All Too Trusting

Published:
2025-05-18 15:04:46
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Russian authorities detain Blum co-founder in criminal fraud case: report

Moscow’s financial crime unit just made crypto’s least-favorite headline again—detaining Blum’s co-founder on fraud charges. Because nothing says ’decentralized utopia’ like handcuffs and extradition paperwork.

The arrest flips the script on Blum’s ’anti-bank’ marketing pitch. Turns out, their revolutionary tech stack included that classic Web3 feature: alleged embezzlement. Investigators claim the exec bypassed compliance protocols to siphon seven figures.

This marks Russia’s third major crypto takedown this year—apparently their blockchain surveillance works better than their SWIFT sanctions evasion. The detained founder now faces a 10-year sentence, proving that even in DeFi, some things remain centralized: prison cells.

What is Blum?

Blum is a Telegram-based tap-to-earn (T2E) crypto mini-app that combines gamified earning with a hybrid decentralized exchange (DEX) platform.

Launched by a team including former Binance executives, Blum aims to make crypto accessible and engaging for both newcomers and seasoned traders.

Smerkis was previously in charge of the Binance CIS segment.

|Square

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