“HashFlare founders given time served for $577M crypto Ponzi”
Here’s a structured breakdown of what happened:
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Article Summary — HashFlare Ponzi Case
Headline: HashFlare founders given time served for $577 M crypto Ponzi
Source & Timestamp: Written by Cointelegraph and published on August 13, 2025, at 02:35 (UTC or CoinGlass default timezone) .
Key Takeaways
1. Defendants & Scheme Details
Sergei Potapenko and Ivan Turõgin, the founders of crypto mining platform HashFlare, were convicted for their roles in a $577 million Ponzi scheme.
2. Sentence & Time Served
The judge in Seattle Federal Court, Robert Lasnik, determined their 16 months already spent in custody constitute sufficient prison time—resulting in “time served” sentencing.
3. Additional Penalties
Each defendant must pay a $25,000 fine and complete 360 hours of supervised community service in their native Estonia.
4. Prosecution & Appeal
Prosecutors had requested a 10-year prison sentence, arguing this was the largest fraud case ever handled by that court. Meanwhile, the Department of Justice is weighing whether to appeal the judge’s leniency.
5. Customer Restitution & Losses
The scheme affected approximately 440,000 customers.
Customers had spent around $487 million on mining contracts, and although more than $400 million worth of assets were forfeited via plea deal, the ex-customers have reportedly withdrawn $2.3 billion in total.
6. How the Scheme Operated
Investigators described it as a classic Ponzi scheme (2015–2019) where investment payouts were funded by new buyers.
Fraudulent dashboards were used to mislead users about mining capacity and returns.
Proceeds were diverted to luxury purchases—such as real estate, jewelry, cars, private jets—by the founders.
