Vladimir Smerkis, co-founder of the Telegram-based crypto project Blum, has been arrested in Moscow on charges of fraud. Russian state media TASS reports that a court has approved his detention during an ongoing investigation. 3Smerkis’s arrest stems from allegations of large-scale fraud under Article 159 of Russia’s Criminal Code. If convicted, he could face a prison sentence between two to twelve years. The case is linked to his previous ventures, including the Token Fund and Tokenbox, which reportedly led investors to lose roughly $15 million according to Mas. Blum quickly distanced itself from the controversy, announcing Smerkis’ resignation as Chief Marketing Officer on May 18th, stating that he will no longer be involved in any capacity. The project assured its community that operations would continue. Despite the arrest, Blum remains committed to delivering promised tokens and transparency with their upcoming BLUM token airdrop planned for Q3 2025 through the firm’s