US authorities have arrested the founders of a crypto wallet for money laundering

In a significant development, US authorities have arrested Keone Rodriguez and William Hill, co-founders of Samourai Wallet, on charges related to operating an unlicensed money transfer business and conspiracy to commit money laundering.

The arrest follows an extensive investigation conducted by the United States Department of Justice (DoJ) in cooperation with the Internal Revenue Service and the FBI.

The indictment, unsealed by the Department of Justice, alleges that Samourai Wallet, a cryptocurrency mixing service, facilitated the laundering of more than $100 million in criminal proceeds, including funds originating from illicit sources such as Silk Road and the Hydra Market.

According to the DoJ, Samurai Wallet allegedly conducted over $2 billion in illegal transactions, earning significant fees in the process.

The cryptocurrency mixing service offers features such as "Whirlpool," which coordinates the exchange of cryptocurrency between users to prevent tracking on the blockchain, and "Ricochet," which adds unnecessary intermediate transactions to hide the origin of cryptocurrency batches.

These features processed a total of over 80,000 BTC (worth over $2 billion), with Samourai Wallet accumulating significant fees, estimated at $3.4 million for Whirlpool transactions and $1,1 million for Ricochet transactions.

Rodriguez has been arrested pending legal proceedings and is expected to appear before a U.S. Magistrate Judge in the Western District of Pennsylvania. Hill has been arrested in Portugal, and the US intends to seek his extradition for trial. Both face sentences of up to 5 years in prison.