Bitcoin exec to spend two years behind bars for Silk Road transactionsEnd of the road Plea

End of the road

Silk Road was one of the causes of the phenomenal rise in crypto-currencies, most notably – Bitcoin for its anonymity. Silk Road itself was dealing in contraband goods and as such, it was taken down by an operation by the FBI which resulted in arrest of its found Ulbritch. Soon another clone,  Silk Road 2 surfaced after the original had been taken down, but that too suffered the same fate as before. Based on evidence gathered during the crackdown, Shrem agreed to partner with Robert M. Faiella to trade over $1 million in cash from buyers. Faiella was the person of contact with the buyers and used the pseudonym BTCKing to carry out the trade. These two were caught red-handed when an undercover agent used the scheme. Here’s how the two carried out the laundering scheme, Faiella would instruct customers to deposit money to third-party bank accounts, then Shrem would use the then active, BitInstant to transfer the corresponding amount back to him.  He would then credit the buyer’s Bitcoin wallet. FBI used a mole to get into this money laundering setup, the mole deposited $500.11 to a bank account and got $444 worth of BTC later that same day.

 Plea

His advocates tried to pass on the blame to his youth(he was 22 years old that time), claiming it was a one time event carried out with the sole purpose of advertising Bitcoin. But the young blood angle didn’t do any wonders on the presiding District Judge Jed Rakoff. Shrem pleaded the Judge for mercy, The judge did not buy the plea and felt that a substantial prison sentence was the need of the hour. He felt this would send out a message to other trying the same scheme.  Also, he didn’t believe that Shrem was just “some kid making a one-time mistake” and determined that he “was knowingly, willfully, to some extent excitedly and even passionately involved in activities he knew were, in part, involved in serious violations of the law.” Despite Shrem’s initial efforts to convince the judge not to hand him a prison sentence (on top of forfeiting $950,000), he told Bloomberg things turned out better than expected. Two years, after all, is easier to digest than the six years prosecutors wanted him to spend in prison.

— Charlie Shrem (@CharlieShrem) December 19, 2014 The news broke when Shrem posted the above tweet. Resource : Engadget