Another day, another Bitcoin entrepreneur charged with fraud. 

This time it was Charlie Shrem, the former vice chairman of the Bitcoin Foundation, CEO of BitInstant, and one of the most recognized people in the Bitcoin community, has been officially indicted by a federal grand jury in New York on April 10. 
You can view the official indictment document here
Guilty Until Proven Innocent 
Shrem has been formally accused of laundering over $1 million dollars in bitcoins by funneling funds for users on the infamous Silk Road website whose founder, Ross William Ulbricht, is also facing federal charges. Only three months ago, Shrem was arrested in New York on charges of acting as an unlicensed money transmitter and of money laundering. 
The Silk Road was a popular online marketplace for illicit goods and services, ranging from drugs to hitmen-for-hire services. The marketplace was terminated by the FBI in October of 2013. Shrem is accused of willfully neglecting to report these illegal transactions, which were conducted through his now-defunct BitInstant company. Shrem resigned from his post as vice chairman of the Bitcoin Foundation shortly after his arrest back in October. 
The official indictment filed by Manhattan US Attorney Preet Bharara includes money laundering, conspiracy and failing to file suspicious activity with federal regulatory agencies. 
Specifically, Shrem allegedly conspired with Robert Faiella, a Silk Road user, who operated under the screen name of BTCKing, to sell over a US$1 million worth of bitcoins to other users on the site while knowing that this money would then be used for illicit activities. 
In light of recent high-profile scandals such as those involving Mark Karpelese of Mt Gox, and Danny Brewester of Neo & Bee, government regulatory agencies are still scratching their heads on their approach to regulating fledgling digital currencies. 
According to Bharara’s office, Shrem will appear before a court for questioning on April 29. He is facing a maximum prison term of 20 years on the most serious charge. 
Reactions from the Bitcoin community 
Such scandals have had a negative impact on Bitcoin’s image and could possibly lead people to keep their distance from such a “high risk” investment, at least until the dust settles. 
Nevertheless, Bitcoin is proving to be resilient despite these setbacks as many Bitcoin enthusiasts label the arrest of embattled entrepreneurs and failure of companies as “bad apples” getting weeded. 
Thomas J. Ackerman, CTO Bitcoin Brothers, says: 
“In every new market you will first find many amateurs and some crooks who try to make something out of it without being properly versed, or make something out of it by abuse. That will always be the case, and is called growing pains.”