The cryptocurrency industry has become an exciting space for many enthusiasts who look for profit as well as entertainment. With over 560 million active users trading and earning in the market, it continues to thrive alongside rapid developments in blockchain technology. With a thriving blockchain industry, more crypto projects and users are expected to emerge.
However, with this unprecedented growth, the landscape has also attracted fraudsters or stealers, including some project founders or executives, where some are suspected, while others remain outside the scope of legal action.
Russia arrests Blum co-founder Vladimir Smerkis
Recently, the Russian news agency TASS reported that the Russian law enforcement, the Zamoskvoretsky District Court of Moscow, detained Vladimir Smerkis, co-founder of the crypto game Blum, for executing large-scale fraud. As the investigation is still ongoing, the court has sanctioned a request from investigators to hold Smerkis in custody
The announcement of Smerkis’ arrest came after Blum posted on X that he had stepped down from his role and was no longer involved in the project.
Although no specific reason was officially stated for the arrest of the Blum executive, reports revealed that he is suspected of undertaking large-scale fraud, under Article 159 of the Criminal Code of the Russian Federation. Several reports show that his arrest may be related to his previous crypto ventures that caused the investors to lose nearly $15 million. The executive also created the first crypto investment fund, The Token Fund, raised $8 million, and eventually closed down, leaving investors in the red.
High-Profile crypto executives accused of crypto crimes
Starting with the Do Kwon case, the Co-founder of Terraform Labs, one that has sparked the crypto community, it has been found that the person was involved in fraudulent activities and securities violations. Alex Mashinsky (former CEO of Celsius Network) was charged with securities fraud and wire fraud in 2023. Another case includes Sam Bankman-Fried, who allegedly stole $18 billion from the bankrupt FTX crypto exchange.
Zhao Dong, founder of crypto exchange RenrenBit, is another culprit in the industry, who is allegedly involved in illegal fundraising and other financial crimes. He was caught by Chinese authorities in 2020.
Besides these executives, there are also ordinary anonymous individuals who have exploited various crypto projects for theft. A report by research firm Chainalysis insinuates that $2.2 billion of funds were stolen from crypto businesses in 2024.
No matter what exploiters carry on in the crypto space, the sector continues to grow with innovative projects and increasing investor interest. One has to be an expert and face challenges while navigating this rapidly evolving industry.
