Estonian Government Reaches Decision In Extradition Of Hashflare Defendants• January 26, 2024 9:50 pm • Comments
The Estonian government has reached a new decision regarding the extradition of the Hashflare defendants.
Hashflare was once a legitimate mining operation that was quietly turned into a Ponzi Scheme following financial trouble and the closure of several mining facilities owned by the mining entity.
Defendants Ivan Turogin and Sergei Potapenko are alleged to have taken $575 million in investment funds and promised miners a lucrative profit via their hash-power rental program.
Investors and clients would purchase computing power from the mining company in return for a portion of the profits made by the mining operation.
According to the United States Department of Justice, Hashflare did not even have a fraction of the purported computing power it advertised to investors. Moreover, they paid investors out of cryptocurrencies they purchased from exchanges.
Additionally, the two defendants are also alleged to have taken $25 million from investors with the promise that they would launch a digital bank called Polybius, but reportedly never established the bank.
Now, the Estonian government has approved the extradition of both defendants to the United States to stand trial. Here’s more on the story:
🚨The Estonian government has decided to extradite Sergei Potapenko and Ivan Turygin, the founders of cloud mining service HashFlare and digital bank Polybius Bank, to the US. pic.twitter.com/HoJ8sW2iNE
— CILLIONAIRE.COM (@cillionaire_com) January 26, 2024
Colin Wu explained: “The U.S. DOJ made a written request for extradition, saying that they deceived the victims into signing fraudulent equipment rental contracts with the mining service provider HashFlare and investing in a crypto bank called Polybius.”
Estonia has approved the extradition to the United States of two people behind HashFlare, a $575 million cryptocurrency Ponzi scheme. Ivan Turogin and Sergei Potapenko were arrested in Estonia in November 2022. The U.S. DOJ made a written request for extradition, saying that they…
— Wu Blockchain (@WuBlockchain) January 26, 2024
Coin Telegraph laid out the charges both defendants are facing:
Turogin and Potapenko have been charged with 18 counts of conspiracy, wire fraud, and conspiracy to commit money laundering in the United States and face up to 20 years each in prison. Their company was once a leading cloud miner but was allegedly run as a Ponzi scheme.
Crypto Scam Never remarked: “Exciting news on the crypto front! The HashFlare crypto scammers are facing extradition to the US. Looks like justice is catching up with them! A big win for the crypto community. Finally, some closure on this issue. Can’t wait to see how this unfolds.”
Exciting news on the #crypto front! The HashFlare crypto scammers are facing extradition to the US. Looks like justice is catching up with them! A big win for the crypto community. Finally, some closure on this issue. Can't wait to see how this unfolds. pic.twitter.com/QyDMxaZtI0
— Crypto Scam Never (@CryptoScamNever) January 27, 2024
Dear users! We would like to inform you that today, on 08.08.2019, we are suspending the sale of ETHASH contracts, since our current capacity has been sold out.
— HashFlare (@hashflare) August 8, 2019
Daily Coin explained:
Initially approved in September 2023, the extradition was halted when the Tallinn Circuit Court intervened in November 2023 following a successful appeal from Turogin and Potapenko.
Instead of sending the founders to the US, the appeals court criticized the Estonian government’s decision, citing an inadequate investigation into essential circumstances, and ordered monetary compensation for the founders.
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