Greek police said on July 26 that they have arrested a Russian man who allegedly masterminded a $4 billion money laundering scheme using the virtual currency Bitcoins.

Police said Aleksandr Vinnik, the head of the BTC bitcoin currency exchange, was arrested on July 25 near the northern city of Thessaloniki.

Vinnik, 38, was indicted in the United States on charges of money laundering, the U.S. Justice Department said on July 26. A California court had issued a warrant for his arrest in January.

"An internationally sought 'mastermind' of a crime organization has been arrested," Greek police said. "Since 2011, [Vinnik] has been running a criminal organization which administers one of the most important websites of electronic crime in the world."

Part of Vinnik's illegal gains, estimated at $4 billion, came from the collapse in 2014 of the Bitcoin exchange Mt. Gox based in Tokyo, police said.

Bitcoin is a virtual currency created by computers. Unlike real-world money such as the U.S. dollar or euro, no central bank issues it and it is not guaranteed by any government.

Just like other currencies, bitcoins can be exchanged for goods and services -- or for other currencies -- provided the other party is willing to accept them.

Based on reporting by AFP and Reuters

