A Los Angeles woman was sentenced Monday to a year behind bars for operating an illegal, unregistered multimillion-dollar money transmitting business which exchanged the digital currency Bitcoin for cash and paid her at least $300,000 annually.

Theresa Tetley, 50, who operated under the name "Bitcoin Maven," was also ordered to serve three years of supervised release following her prison term, and pay a $20,000 fine. U.S. District Judge Manuel Real additionally granted an order of forfeiture for 40 Bitcoin -- currently worth about $267,600 -- $292,264 in cash and 25 assorted gold bars seized by law enforcement in March.

Tetley asked the judge for leniency, explaining that she first got involved in Bitcoin as a hobby and had no criminal intent.

"But I screwed up epically," she said, standing before Real. "It quickly became a business--and I broke all sorts of laws. I have learned my lessons."

Tetley previously pleaded guilty in downtown Los Angeles to federal charges of having operated a money transmission business that failed to comply with federal registration requirements and that she conducted a financial transaction involving proceeds of drug trafficking.

The case against Tetley is thought to the first of its kind in Southern California, although other Bitcoin traders have been prosecuted elsewhere in the past year.

Assistant U.S. Attorney Puneet V. Kakkar told the court that Tetley used her business for "nefarious" means, making at least one transaction with an undercover government agent who told her the deal was being used to hide narcotics-related cash.

"Knowing that, the defendant carried on the transaction and offered to meet (the agent) again," Kakkar said.

Between 2014 and 2017, Tetley used a listing on localbitcoins.com, a peer-to-peer online marketplace similar to eBay or Craigslist, where visitors can buy and sell digital currency from others in their community.

Digital currency exists entirely on the internet and is not stored in any physical form. It is not issued by any government, bank, or company and is instead generated and controlled through computer software operating on a decentralized peer-to-peer network. While digital currency is not illegal in the United States and may be used for legitimate financial transactions, the "pseudonymous" nature of the currency is used for conducting illegal transactions, such as the sale of drugs.

Kakkar said that in the course of running her business, Tetley exchanged between $6 million and $9.5 million.

Arguing unsuccessfully for a 30-month prison term, the prosecutor said jail terms are necessary in such cases to "send a signal" and "hopefully deter" those using Bitcoin and other virtual currencies for criminal schemes.

The judge ordered Tetley to self-surrender to begin her prison term by Aug. 15.

