Blockchain Expert Released By Kidnappers After Ransom Paid

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Russian-born Pavel Lerner, a well-known cryptocurrency investor and entrepreneur, was kidnapped in Kiev on Boxing Day and has since been released

bitcoinsA leading blockchain expert has been released by kidnappers in the Ukraine after they were paid more than $1m (£750,000) in Bitcoin.

Pavel Lerner, a Russian cryptocurrency expert working for Exmo, a UK-registered exchange, was abducted by masked individuals on Boxing Day, according to local reports.

Exmo said it had re-established contact with Lerner on Friday, 29 December, and that he was unharmed.

“At the moment, he is safe, and there was no physical harm inflicted on him,” the company said in a statement. “Nevertheless, Pavel is currently in a state of major stress, therefore, he will not provide any official comments in the coming days.”

Ransom

The abduction is under investigation by security authorities in the country, Exmo said.

Exmo is registered with Companies House and its head office is in Polegate, Sussex, but its main operations are in the Ukraine.

An adviser to the Ukrainian interior ministry said a ransom of more than $1m had been paid in Bitcoin, but it was unclear who had paid the funds.

“This is the first such case in Ukraine linked to Bitcoin,” Anton Gerashchenko, an adviser to interior minister Arsen Avakov, told Reuters in a text message.

Exmo said Lerner’s role did not involve access to the financial assets of the company’s users.

Local news reports said Lerner had been snatched by men wearing dark clothing and balaclavas as he was leaving his Kiev office.

Targeted attack

Separately, Exmo said it was hit by a targeted denial-of-service attack on Thursday that briefly halted the exchange’s operations. The firm didn’t indicate whether the attack was connected with Lerner’s abduction.

The incident follows a tumultuous few months for cryptocurrencies such as Bitcoin, with the value of many spiking during the course of the year.

Last week the value of cryptocurrencies rebounded after two days of losses partly spurred by the imposition of tougher rules by national regulators.

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