The Zamoskvoretsky District Court of Moscow has sanctioned a request made by investigators to hold Smerkis while the probe is ongoing, according to a report from TASS, a Russian state-owned news agency, on May 18.

Smerkis, formerly in charge of Binance operations in Russia, is suspected of large-scale fraud, as per Article 159 of the Russian Federation’s Criminal Code. Violations of this article can lead to a sentence of two to 12 years in prison. The exact charges against Smerkis remain unclear.

Russian media outlet Mash linked Smerkis’ fraud allegations to his role in The Token Fund and Tokenbox crypto projects he co-founded in 2017, which reportedly resulted in investors incurring losses of about $15 million.

Blum, unconnected with The Token Fund and Tokenbox initiatives, stated on May 18 that Smerkis had stepped down from his position as the company’s chief marketing officer and would no longer be part of the project. Blum reiterated its continued commitment and focus on its objectives, with daily operations remaining unaffected.

Blum is a crypto project that incorporates a decentralized exchange into Telegram Mini Apps, thereby allowing users to trade cryptocurrencies, earn rewards, and partake in token airdrops.

However, Smerkis’ arrest has raised concerns about the future of Blum’s planned token airdrop. Back in April, Blum hinted at a possible BLUM token listing in Q3 of this year. Users could earn BLUM tokens by playing Blum’s newly introduced Drop Game and then convert these points into tokens during the scheduled token generation event.

Yet, Smerkis’ detention has led to doubts about the BLUM token airdrop’s feasibility. As one community member and Blum user noted, “Blum needs to provide clarification about the proposed airdrop.”

Crypto influencer RK Gupta also expressed concerns, stating, “No airdrop. No updates. Just silence. Was it all worth it?”

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