Prosecutors Oppose Lenient Sentences In $577 Million HashFlare Ponzi Scheme Fraud

US prosecutors have appealed the sentences handed to HashFlare co-founders in relation to a $577 million Ponzi scheme linked to a crypto mining service. The appeal was made on August 26, 2025 in the Seattle federal court for review by the Ninth Circuit.

According to Cointelegraph, HashFlare co-founders, Sergei Potapenko and Ivan Turõgin, were arrested in Estonia in October 2022 and spent 16 months in custody there before being extradited to the US in May 2024. They pleaded guilty to conspiracy to commit wire fraud. Prosecutors argued that the case was the most significant fraud the court had ever handled and sought at least 10 years in prison.

However, on August 12, 2025, Judge Robert Lasnik sentenced the duo to time served, plus a $25,000 fine each and 360 hours of supervised release community service in Estonia. Prosecutors state that HashFlare existed between 2015 and 2019, collecting more than $577 million in deceptive sales. The firm allegedly posted made-up dashboards that overestimated mining capacity and created returns in an attempt to lure investors.

Blockchain crime specialists have said that minimal punishments and lax enforcement encourage additional crypto fraud by providing a perception of low risk for the perpetrators.

One In Four UK Adults Open To Crypto For Retirement: Survey

A latest survey by insurance provider Aviva has discovered that almost a quarter of UK adults are willing to add cryptocurrency to their pension funds. The survey by Censuswide among 2,000 adults from June 4-6, 2025 showed 27 per cent would be willing to have crypto included in their pension investment. The most common reason given by those (over 40 per cent of the respondents) who would be willing to do so was that crypto would offer greater potential returns.

The survey further revealed that 23 per cent of respondents would even think about cashing in part or all of their pension to invest in crypto. Around 80 per cent of UK adults have pensions with a combined worth of 3.80 trillion pounds. But chances to invest directly in crypto in UK retirement funds remain minimal.

The survey also emphasised that 11.60 million people have invested in cryptocurrency at some point and two-thirds of them still own it today. Young adults played a key role and nearly 20 per cent of those between the age of 25 and 34 had already cashed out pension funds to invest in digital currency.

Cybersecurity threats like hacking and phishing were the largest issue identified by 41 per cent of respondents, followed by 'no regulation' at 37 per cent and volatility at 30 per cent.

Trader Launches $2.5 Million Campaign After MEXC Freezes Funds

High-profile crypto trader, alias the "White Whale," have accused crypto exchange MEXC of locking $3.10 million in their own account. The trader explained that the platform insisted upon an in-person identity check in Malaysia to release the funds, rather than usual online verification. In turn, the trader mounted a public campaign on social media. Initially, a $2 million reward was issued to supporters who minted a free NFT on the Base network and posted the hashtag #FreeTheWhiteWhale while tagging MEXC or its chief operating officer on X (formerly Twitter). 

Participants were guaranteed a percentage of $1 million in USDC. The campaign was subsequently raised to $2.5 million, with another $250,000 committed to charities and another $250,000 to participants.

MEXX stated that it does not freeze funds for unjustifiable reasons. The exchange clarified that account holds are only used if risk-control policies are activated and not due to making profits. It did not address the alleged in-person verification requirement.

Other users have complained as well. Pablo Ruiz, a user, explained that his account with $2 million in USDT was frozen unexpectedly and had been impossible to access for months even after numerous attempts to correct the situation.