Crypto Exchange ShapeShift Calls Money Laundering Claims 'Inaccurate and Deceptive'

ShapeShift has issued a stinging rebuke of a Wall Street Journal investigative article that claimed the crypto exchange was used by criminals to launder money.

Calling the claims "Factually inaccurate and deceptive," Voorhees wrote that his exchange had been working with the Journal for nearly half a year, but the final story "Omitted relevant information" and showed that "The authors do not have a sufficient understanding of blockchain and our platform in particular."

The authors concluded that some $88 million was laundered through 46 different exchanges over two years, with $9 million going through ShapeShift in that period.

The exchange has "a strong record of complying with law-enforcement requests, providing valuable assistance in over 30 investigations in 13 different countries all over the world."

"Unlike most other exchanges, ShapeShift is a crypto-to-crypto, non-custodial platform. We don't take custody of user funds, but instead swap our own assets for theirs, at a set price. We don't touch fiat currency, so users cannot swap their dollars/euros/yen for our bitcoin/ethereum/dogecoin. Not a single dollar, euro, or yen has ever been laundered through ShapeShift. It can't be done."

He cited one example, saying that funds from a suspicious transaction were sent to an exchange, which later sent funds to ShapeShift.

"Because ShapeShift happens to be a customer of this same exchange - 10 months later in a completely unrelated transaction - the exchange sent funds to ShapeShift. The authors didn't understand how to properly read the blockchain transactions, so they assumed there was $70k in 'dirty money' sent to ShapeShift," he wrote.

Voorhees also asserted that ShapeShift is one of the most transparent exchanges operating today.

Every transaction through the exchange is published online, despite the user privacy protections that it has maintained to date, he wrote.

The Journal relied on this information to conduct its investigation, he said, adding that "Perhaps the irony is lost on the WSJ, but the WSJ would have been unable to do this kind of investigation with any other crypto exchange, because they aren't transparent in this way."