Crypto Twitter Makes Fun of DOJ’s ‘Major Action’ Against Obscure Russian Exchange Bitzlato

Users on Twitter were quite anxious after the U.S. Department of Justice (DOJ) released a statement on Wednesday that it was going announce a “major international cryptocurrency action” in a few hours.

Prices started dipping, and wild speculation started. Some believed it would be related to Binance or some other major player in the industry. Binance CEO Changpeng Zhao even tweeted an hour before the DOJ announcement “4”, referring to his fourth New Year resolution not to pay any attention to FUD.

As it turned out, the DOJ’s “major action” was related to a tiny, unknown Russian exchange called Bitzlato. The DOJ seized the exchange and arrested its co-founder Anatoly Legkodymov. The DOJ accused the Hong Kong-registered exchange of processing more than $700 million in illicit funds. Legkodymov was charged with money laundering.

The DOJ said that Bitzlato was closely tied to a darknet marketplace called Hydra Market, known for drug selling, money laundering, and stolen financial information. The authorities shut it down last year.

When the DOJ announced the charges against Bitzlato, many were perplexed. Frank Chaparro, a crypto journalist for six years, said on Twitter that he had never heard of the exchange and asked if he could “sue the DOJ for wasting an hour of my life.”

Hsaka, a well-known crypto trader, posted a meme implying that the DOJ didn’t protect investors from FTX, Celsius, and other bankrupt crypto companies but instead charged an unknown exchange.

Ryan Selkis, the founder of crypto research firm Messari, said that the DOJ is wasting taxpayers’ money by focusing on the wrong bad actors.

DonAlt, another crypto trader, said: “If Bitzlato going down doesn’t take us to $12k I really don’t know what else could.”

Wes Mantooth made fun of Bitzlato’s assets.

While the DOJ and other U.S. regulators have been active in bringing charges against crypto criminals, the wider crypto community is waiting for them to investigate and bring justice to bigger players in the industry. For investors, it’s important to remember that, in most cases, regulators come in after the crime has already occurred, at least in finance.