Moscow Court Sentences Bitmama to Seven Years for $23 Million Bitcoin Scam

A Moscow court has sentenced Valeria Fedyakina, known as “Bitmama,” to seven years in prison for orchestrating a $23 million Bitcoin scam. Fedyakina, who posed as a cryptocurrency expert, promised investors significant returns but instead operated a massive pyramid scheme, stealing 23 million dollars worth of Bitcoin within just two months.

Fedyakina moved the stolen funds to crypto wallets in the United Arab Emirates, never intending to invest the money as promised. She tricked investors by offering to convert their money into crypto in Dubai, claiming this would help circumvent Russian sanctions and banking restrictions. Many investors believed her, attracted by the promise of quick profits and the allure of bypassing stringent banking rules.

Fedyakina, who referred to herself as Bitmama Finance, conducted her operations from hotels in Moscow, guaranteeing profits from oil, gold, and mineral investments—all of which were false claims. Witnesses testified that investors were pouring millions of dollars into her scheme daily, with collections initially ranging from 2 million to 3 million dollars, eventually increasing to 15 million dollars per day. The case was heard in the Presnensky District Court, which handed down the verdict on June 24. Prosecutors had sought a maximum sentence of ten years, but the court sentenced Fedyakina to seven years in prison.

The court also ordered Fedyakina to compensate the stolen funds, a decision that victims hope will help them recover some of their losses. The scam had a devastating impact on many investors, wiping out their savings. This case highlights the risks associated with investing in unregulated and high-risk crypto schemes, especially in an environment where sanctions and banking restrictions drive people to seek alternative financial solutions.

Russia has seen a surge in crypto-related crimes, with scammers exploiting the situation to defraud unsuspecting investors. Fedyakina's case serves as a stark reminder of the need for vigilance and due diligence in the crypto world. The court's decision sends a clear message that crypto criminals will be held accountable, and regulators must stay ahead of emerging threats to protect investors.

Fedyakina's actions underscore the importance of verifying investment opportunities and being wary of promises of rapid wealth. The authorities in Russia have pledged to continue cracking down on crypto fraud, hoping that this case will deter others from attempting similar schemes. Fedyakina is currently serving her seven-year sentence and is obligated to repay every stolen ruble. Her victims remain hopeful that they will be reimbursed, emphasizing the need for secure systems in the crypto world to prevent such frauds in the future.