US wants 10-year jail term for HashFlare co-founders in fraud case

US prosecutors are pushing for a 10-year prison sentence for HashFlare co-founders Sergei Potapenko and Ivan Turogin, who pleaded guilty to conspiracy to commit wire fraud in February.

The Estonian nationals are due to be sentenced on Thursday following a plea deal with prosecutors.

Lawyers for the defendants have requested time served, arguing victims suffered no real losses, partly citing an expert opinion and claims of returning $400 million in crypto to users.

Prosecutors rejected these claims, saying the expert’s data was based on fabricated earnings and that the figures actually supported victims’ accounts.

They described HashFlare as a “fraud” and a “Ponzi scheme,” asserting that the harm to victims “could not be more real.

Potapenko and Turogin were indicted in October 2022, arrested in Estonia, and extradited to the US in May 2024, later being released on bail in July 2024.

As part of their plea, the pair agreed to forfeit interests in assets frozen by the US government in 2022.

During proceedings, both men received letters from the US Department of Homeland Security ordering them to “self-deport” under the Trump administration’s mass deportation initiative.

It remains unclear whether their immigration status will influence the sentencing decision.

Cointelegraph sought comment from Potapenko’s legal team but received no reply before publication.