Charlie Shrem, the CEO of Bitcoin exchange company BitInstant and a well-known voice in the virtual currency community, has been charged with scheming to sell and launder $1 million worth of Bitcoin to users of the illegal drug website Silk Road.
The indictment, unsealed today in Manhattan federal court, says that the 24-year-old Shrem conspired with Robert Faiella, a 52-year-old who used the handle "BTCKing." Faiella allegedly obtained Bitcoins from Shrem, then sold them anonymously to Silk Road users at a markup through the site.
The prosecutors say Shrem was aware of the illegal activity and even bought drugs on Silk Road himself. "Truly innovative business models don’t need to resort to old-fashioned law-breaking, and when...
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