Cryptocurrency exchange Binance is said to have processed nearly $346 million in crypto transactions for Bitzlato, the cryptocurrency trading platform that was shut down in an international law enforcement operation. US authorities say the world’s largest digital asset trading platform is among the main partners of Russian-owned Bitzlato.

Blockchain data shows that Binance transferred over 20,000 BTC for Bitzlato from 2018

The global leader in crypto trading, Binance, has been accused of transferring nearly $346 million worth of crypto to Hong Kong-based Bitzlato, Reuters reports citing data from Chainalysis. Bitzlato was a little-known exchange until it was recently targeted in what US authorities describe as “a significant blow to the crypto crime ecosystem.”

Last week, the Ministry of Justice announced that the co-founder and major shareholder of Bitzlato, Russian citizen Anatoly Legkodymov living in China, was arrested in Miami and charged with running an unlicensed money exchange business that handled $700 million illegal money.

On Wednesday, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) said that Binance is the only major crypto exchange dealing with Bitzlato and one of its top partners. Among other things is the darknet market WaterPeer-to-Peer (P2P) Exchange Localbitcoins and Cryptocurrency Investment Scams FinikoRussia’s largest financial pyramid in recent years.

According to FinCEN, Hong Kong-registered Bitzlato, better known to Russian-speaking users, is a “major money laundering concern” related to illegal Russian financing. The office did not disclose details of the transaction sizes of the aforementioned platforms with Bitzlato but said it would prohibit financial institutions from transferring funds to the exchange without specifying the entities it refers to.

According to data compiled by blockchain forensics firm Chainalysis and viewed by Reuters, Binance has transferred over 20,000 BTC for Bitzlato, valued at $345.8 million at the time of the transaction, from May 2018 to the shutdown. The report also notes that Bitcoin for around $175 million was transferred to Binance from Bitzlato during this time period, making Binance its largest receiving partner.

The Largest Crypto Exchange Says It Supported the Investigation of Bitzlato

Binance has “provided substantial assistance” to international law enforcement to assist with their investigation of Bitzlato, a spokesperson for the exchange told the news outlet via email, while denying it. provide more details on the crypto giant’s dealings with Bitzlato or its partnership with the authorities.

Finland-based Localbitcoins said it has never had “any form of partnership or relationship” with Bitzlato while acknowledging that some P2P traders on their platform “will also trade on the Bitzlato P2P marketplace” but pointed out that there have been no transactions between the two exchanges since October 2022.

Reuters commented that there is no evidence that Binance, Localbitcoins or Finiko transactions with Bitzlato violated any laws or regulations. It is also not possible to determine whether Binance’s transactions with Bitzlato are under review. At the same time, the US-led action against Bitzlato comes as the Department of Justice investigates Binance for possible money laundering and sanctions violations.

Several European countries are also involved in the investigation against Bitzlato. Last week’s announcement revealed that French law enforcement agencies had dismantled the platform’s digital infrastructure in the country and confiscated its website. On Monday, Europol get the news that four other members of the exchange’s team were arrested in Spain and Cyprus.