Shrem's Case Postponed for Possible Plea Deal

Prosecutors have requested a second postponement of bitcoin entrepreneur Charlie Shrem's court case over alleged money-laundering, as the participants look to cut a plea deal, according to reports.

Assistant US Attorney Serrin Turner asked that the case be postponed to 28th April and confirmed that plea deal discussions were taking place, according to a 28th March filing in the Manhattan federal court.

Now @CharlieShrem talking plea deal over money laundering @BloombergNews





– Carter Dougherty (@CarterD) 1 April 2014

Shrem, 24, faces charges of money laundering, with accusations he used BitInstant, the now-defunct exchange he founded, to actively facilitate bitcoin transactions to allow users to purchase illegal items on the Silk Road Marketplace, which itself was shut down by the Feds in October.

His co-defendant in the case is 52-year-old Florida native Robert M. Faiella, also known as 'BTCKing'.

House arrest

Shrem has lived under house arrest at his parents' house in New York City on a $1m bond since his very public arrest in January. He was stopped at John F. Kennedy airport on his return to the US after speaking at a conference in Amsterdam.

Questions have been raised about the nature and timing of that arrest, and whether it was a publicity stunt to intimidate bitcoin businesses just before investigatory hearings by the New York State Department of Financial Services (NYDFS) where Shrem was due to testify.

NYDFS Superintendent Benjamin Lawsky, who chaired the hearings, answered such questions by saying: "Let me be clear on this. Absolutely not true."

In interviews, Shrem has expressed bewilderment at his treatment and maintained he had been cooperating with authorities by answering any questions openly and honestly, providing information he expected would help authorities draft sensible regulations for digital currency, but which was ultimately used against him instead.

Once the Vice Chairman of the Bitcoin Foundation and a New York City restaurateur, Shrem was forced to resign from his positions, but has attempted to stay active in the bitcoin community since his arrest, giving regular interviews and commentary on current issues such as the recent Mt. Gox debacle.

CoinDesk reached out to Shrem on the current matter earlier, but he replied he was unable to comment at this time.