California Man Sentenced to More Than Seven Years in Prison on Charges Related to Bitcoin-Facilitated Drug Market

A California man was sentenced to more than seven years behind bars on charges related to operating an underground drug-trafficking market powered by Bitcoin ( BTC ) transfers.

Federal prosecutors say John Khuu illegally imported counterfeit pharmaceutical and MDMA pills from Germany and subsequently used dark web markets to distribute the illicit substances to customers across the US.

Khuu, 29, was paid in Bitcoin and other crypto assets, which he and his co-conspirators exchanged for US currency that was then laundered and transmitted to dozens of different accounts.

The California resident was indicted in May 2022 in the Eastern District of Texas and charged with conspiracy to commit money laundering. Three months later, Khuu was also indicted in the Northern District of California and charged with unlawful importation of a Schedule I controlled substance. He was arrested by agents in Garden Grove, California a few days after the second indictment.

Khuu’s arrest was the result of “ Operation Crypto Runner ,” a multi-agency law enforcement effort that resulted in a batch of charges filed against 21 individuals for their alleged involvement in transnational money laundering networks.

Last year, Khuu pled guilty to conspiracy to commit money laundering, conspiracy to operate an unlicensed money-transmitting business and importation of MDMA.

This week, U.S. District Judge J. Campbell Barker sentenced him to 87 months in federal prison.

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