The founders of HashFlare, a cryptocurrency mining platform behind a $577 million Ponzi scheme, have avoided further prison time after pleading guilty to conspiracy to commit wire fraud. Sergei Potapenko and Ivan Turõgin, both from Estonia, were sentenced in a Seattle federal court to time served, having already spent 16 months in custody before extradition to the United States in May 2024.

Judge Robert Lasnik also ordered each man to pay a $25,000 fine, complete 360 hours of community service, and serve supervised release in Estonia. The Department of Justice (DOJ) is considering an appeal, noting prosecutors had sought 10-year prison terms, calling it the largest fraud case ever tried in the district.

From 2015 to 2019, HashFlare sold more than $577 million in mining contracts while allegedly showing customers fake dashboards that overstated the company’s Bitcoin mining capabilities and returns. Prosecutors said it operated as a classic Ponzi scheme—paying existing customers with funds from new ones—while the founders spent millions on Bitcoin, luxury cars, real estate, jewelry, and private jet travel.

Potapenko and Turõgin argued that customers did not suffer significant losses, pointing out that they forfeited $400 million in assets and that most investors withdrew far more than they initially invested. Records showed 390,000 customers who spent $487 million eventually withdrew $2.3 billion.

The two men had also faced confusion earlier this year after receiving a Department of Homeland Security letter instructing them to “deport immediately” despite a court order to remain in the U.S. They have repeatedly expressed their desire to return to Estonia.