Mr. Shrem was the founder and chief executive of a popular website, Bitinstant, where Bitcoins could be bought using dollars. The criminal charges unsealed on Monday allege that Mr. Shrem used his company to convert money anonymously for people interested in buying narcotics on the Silk Road site, and also personally bought drugs on the site. He was arrested at John F. Kennedy Airport.

The scheme was allegedly operated in cooperation with another man, Robert Faiella, known as BTCKing, who was arrested on Monday….

Mr. Shrem has been an outspoken advocate for the virtual currency. He is the vice chairman of the Bitcoin Foundation, a non-profit that educates the public on digital money. Mr. Shrem was still listed on Monday as a member of the foundation’s board.

Two Executives of Bitcoin Businesses Are Arrested [DealBook]

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  1. Posted by GEST | January 27, 2014 at 3:27 PM

    Wow, one word after lunch. A new Shazar low.

  2. Posted by Guest | January 27, 2014 at 3:28 PM

    The Winkie Twins sound a little scared.

  3. Posted by Guest | January 27, 2014 at 3:36 PM

    sounds like it's gonna make buying mary jane on your credit card in Colorado that much more difficult.