Millions more in smaller transactions ultimately ended up in Binance's wallets. Overall, the five largest Bitzlato-connected wallets sent more than $30 million directly to Binance. From there, over the course of four years, that intermediary wallet deposited around $15 million worth of crypto onto Binance's platform, according to data from Arkham Intelligence. One Bitzlato whale moved a little over $21 million worth of cryptocurrencies, including ether and tether, a dollar-pegged stablecoin, from Bitzlato to an intermediary wallet. Those wallets also received millions more in funds from other exchanges, including Huobi, FTX, Poloniex, Nexo, and WhiteBIT, a Ukrainian exchange. In the four years that Bitzlato operated, only $52 million moved directly from the exchange to Binance, the same dataset shows.īut a cursory review of some of Bitzlato's largest exchange partners indicates that tens of millions more flowed from Bitzlato through other crypto wallets to Binance, in an apparent effort to conceal the origin of the funds.ĬNBC reviewed transaction data for the ten largest recipients of Bitzlato outflows, which collected over $45 million in Bitzlato-originated funds. But tracing assets through a blockchain is a relatively straightforward process, since every transaction is recorded on a publicly accessible ledger.įor all of 2022, and the brief weeks that Bitzlato operated in 2023, only $9.7 million moved directly from Bitzlato to Binance, according to data from Arkham Intelligence. Much like in traditional finance, where money moves from bank to bank and between holding companies, moving crypto assets through multiple wallets is an elementary way to obscure the flow of money. Crypto might sit on one of these interim platforms for mere minutes. But smaller exchanges can often function as a sort of bridge between the entity looking to transfer their coins and the ultimate destination where the tokens will be custodied. On a larger exchange like Binance or Coinbase, for example, many customers opt to let the platform custody their crypto tokens. But total flows in and out of Bitzlato were in the hundreds of millions of dollars, suggesting that Bitzlato was a way station for users looking to keep their crypto at more established exchanges. By comparison, Binance's highest balance was valued at over $60 billion.
The movement of Bitzlato's funds raises questions about the efficacy of Binance's AML practices, especially given that Binance's own outside AML vendor, Chainalysis, issued a report in February 2022 estimating that 48% of Bitzlato's 2019-2021 cryptocurrency receipts were "illicit or risky."īitzlato's highest crypto balance was valued at a mere $6.6 million, according to Arkham Intelligence. Personal Loans for 670 Credit Score or Lowerīinance, the largest crypto exchange in the world, has not been connected to any criminal activity, nor have regulators accused it of knowingly accepting illicit funds, although the exchange is reportedly under its own criminal probe by the Department of Justice in relation to its compliance with anti-money laundering, or AML, laws. Personal Loans for 580 Credit Score or Lower Best Debt Consolidation Loans for Bad Credit
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