Deputy Editor
The U.S. Department of Justice (DOJ) says a group of criminals who stole $5 million worth of bitcoin used the online cryptocurrency casino Stake to launder the funds.
The DOJ seeks to reclaim the $5 million through civil forfeiture, according to a statement it released last week.
How Scammers Stole $5 Million
The suspects allegedly used a method called SIM-swapping to steal the currency in the first place. SIM-swapping is a form of identity theft that involves tricking cellular providers into transferring a victim’s phone number to a new SIM card. Texting a one-time code to a mobile number is a common form of two-factor authentication (2FA). Having access to the phone number thereby gives hackers the ability to bypass 2FA on financial systems or, in this case, cryptocurrency wallets.
The DOJ didn’t say how many suspects have been arrested. However, repeated use of the word “perpetrators” in the press release indicates more than one suspect in the crimes.
Stake Served as Money-Laundering Platform
The release says the thieves used SIM-swapping to rob five victims between Oct. 22, 2022 and March 21, 2023. To throw authorities off their trail, they then allegedly cycled the stolen cryptocurrency through more than 30 transactions.
Much of that attempted laundering occurred via a single Stake account, the DOJ said. The perpetrators concentrated all of the funds into that account at one point before using repeated withdrawals and deposits to obscure the source of the funds.
Offshore cryptocasinos offer thieves a prime opportunity to launder stolen funds because they don’t need to follow the strict anti-money laundering protocols imposed on domestically regulated casinos. Stake holds a license via Curacao, which is attempting to reform and legitimize its regulatory policies, but was known until recently as a “rubber-stamp” jurisdiction that provided minimal oversight.
The DOJ didn’t levy any accusations against Stake. Its flagship cryptocurrency site doesn’t accept US customers, though an affiliated sweepstakes-based site, Stake.us, does. The latter also offers online poker.
Neither branch of Stake is a stranger to regulatory difficulties. Stake.com closed its licensed U.K. business in March 2025 after an ad triggered an investigation. Meanwhile, Stake.us was recently named in a high-profile California lawsuit, along with several of its game suppliers and the video gaming streaming platform Kick, which has the same founders at Stake.
As a new sweepstakes ban nears becoming law in California, Stake.us may soon be forced to leave that lucrative market.
Image credit: Wikimedia Commons (license)
