Bitcoin Pioneer Charlie Shrem Pleads Guilty in Silk Road Case

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Charlie Shrem, one of the foremost promoters of the "virtual money" Bitcoin, pleaded guilty Thursday along with a second man to helping route money through the "dark Web" black market Silk Road, according to court documents.

Shrem, 24, a co-founder of the Bitcoin Foundation and former chief executive of the Bitcoin exchange BitInstant, pleaded guilty in U.S. District Court in New York to a reduced charge of making an unlicensed money transmission, while Robert Faiella, a Florida Bitcoin operator known as "BTCKing," pleaded guilty to running an unlicensed money transferring business.

Shrem originally was charged with more serious offenses, including money laundering conspiracy and willfully failing to file suspicious activity reports with banking authorities, according to an April indictment that accused the duo of scheming to sell $1 million worth of Bitcoin to anonymous drug buyers on Silk Road, which federal authorities shut down last year.

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— M. Alex Johnson