Lawyer says Hashflare co-founders may self-deport after $400M return

The co-founders of crypto mining service Hashflare, Sergei Potapenko and Ivan Turogin, have received conflicting orders regarding their stay in the United States following their guilty pleas to wire fraud.

In an April 11 court filing, their lawyer revealed that the US Department of Homeland Security (DHS) sent letters instructing the pair to “immediately” leave the country.

This directive contrasts with bail conditions set by Judge Robert Lasnik, which require the Estonian nationals to remain in Washington state until sentencing.

Potapenko and Turogin pleaded guilty in February to conspiracy to commit wire fraud, admitting to defrauding Hashflare users of over $550 million between 2015 and 2019.

They also raised $25 million in 2017 from investors for a digital bank project called Polybius, which was never launched.

The two were indicted in October 2022, arrested in Estonia, and extradited to the US in May 2024.

Since July 2024, they have been out on bail but face up to 20 years in prison at sentencing.

Mark Bini, defense counsel at Reed Smith, told that the DHS letters create a legal contradiction.

“Their conditions of release include that they comply with the law. And here you have this letter saying if you stay in the country, you’re breaking the law. And of course, their bail conditions say they can’t leave the Seattle area,” he said.

The DHS letters were reportedly part of a mass deportation effort targeting immigrants who entered legally via the CBP One app, but some US citizens also received similar notices.

Bini noted this is an unusual case of conflicting federal directives and that the co-founders now carry letters deferring their “self-deportation” for one year to prevent mistaken detention.

Potapenko, Turogin, and Hashflare have returned $400 million in crypto payments to users and agreed to forfeit frozen assets.

“We’re going to try and convince the judge to frankly side with DHS and let them self-deport to Estonia to their families because we believe that there was no actual financial harm to the customers of Hashflare,” Bini said.