Thailand Seizes 100,000 Bitcoins in Arrest of Infraud Kingpin Sergey Medvedev

Authorities in Thailand have reportedly seized 100,000 bitcoins following the arrest arrest of cyber crime kingpin Sergey Medvedev.

Bitcoin Seized

The coins were seized by law enforcement agencies in the wake of a Feb. 2 arrest of Medvedev, the co-founder of an online criminal network called Infraud. The platform served as a marketplace for buyers and sellers of stolen credit card information, weapons, narcotics, government documents and other illegal items commonly traded on the darknet.

Using today’s prices, the coins confiscated by Thai authorities are worth roughly $822 million. About six weeks ago, the bitcoins would have been worth nearly $2 billion.

Medvedev, a Russian national, was arrested in Bangkok on Feb. 2 at the request of U.S. law enforcement agencies. His apartment was raided by 30 officers from Thailand’s Crime Suppression Division (CSD), which confiscated the coins, a notebook computer and several documents.

The Infraud group operated under the motto, “In Fraud We Trust.” It was widely regarded as one of the biggest online criminal networks in existence. The Bangkok Post reports that the group was formed in Ukraine in 2010 with Medvedev and Svyatoslav Bondarenko.

The organization operated vending websites that made it easy for criminals to purchase stolen card and identity data. The platform had 10,901 members approved to buy and sell illicit items, according to various reports.

According to  U.S. Deputy Assistant Attorney GeneralDavid Rybicki, Infraud was “the premier one-stop shop for cyber criminals worldwide.”

The Link Between Cryptocurrencies and Crime Networks

For all its apparent benefits, bitcoin has been considered a key enabler of global crime networks. In the early days of digital currency, many of its opponents conflated it with the dark web, and used criminal networks like Infraud to de-legitimize bitcoin.

Advances in digital currency mean bitcoin isn’t the only platform capable of masking international crime networks. In fact, it isn’t even the best at doing so.

For the past two years, cyber criminals have been disavowing bitcoin in favor of “privacy coins” that offer greater anonymity. That was the key takeaway of a recent report released by Recorded Future, an intelligent firm that analyzes criminal marketplaces.

According to the report, bitcoin’s stock among cyber criminals has been declining for the better part of two years, with a greater percentage of dark web users preferring Litecoin and even Dash.

“Bitcoin remains the gold standard in the dark web, with all vendors accepting it as a payment, and Litecoin emerged as the second most popular currency, with 30 percent of all vendors who implemented alternative payment methods willing to accept it,” the report read.

Litecoin generally isn’t part of the same “privacy coin” grouping as Dash, Monero and Zcash. However, it is still considered one of the more privacy-oriented altcoins after its developers added confidential transactions (CTs) to the protocol. The addition was made last September, and was considered a significant competitive advantage in Litecoin’s quest to overtake bitcoin.

Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

Chief Editor to and Contributor to, Sam Bourgi has spent the past nine years focused on economics, markets and cryptocurrencies. His work has been featured in and cited by some of the world's leading newscasts, including Barron's, CBOE and Forbes. Avid crypto watchers and those with a libertarian persuasion can follow him on twitter at @hsbourgi