The Department of Justice said on February 8 that Ilya Lichtenstein, 34, and his wife Heather Morgan, 31, both of New York, were detained for suspected conspiracy to launder $4.5 billion in stolen cryptocurrency.
According to the article, law enforcement has confiscated almost $3.6 billion in cryptocurrency tied to the attack thus far. If convicted, the couple faces up to 25 years in jail, and they are scheduled to appear in federal court in Manhattan on February 9.
Crypto Twitter is presently flooded with video snippets of Morgan dancing around on the social media app TikTok, but many of the comments are far too racy to be reproduced here.
The couple used a variety of laundering strategies, including forged identities, bogus internet accounts, automated transactions, and “chain hopping” by changing to privacy-focused coins. On-chain expert David Pull dug into the wallet activity and digital loot movements, concluding that this is only one example of how Bitcoin’s public ledger, open to anyone, allowing observants to observe the ledger’s history unfolding live.
Lichtenstein and Morgan are accused of conspiring to commit money laundering and defraud the US. The complaint was filed in federal court in Washington, D.C.
The two are accused of plotting to launder 119,754 bitcoin that was taken after a hacker got into Bitfinex and launched over 2,000 unauthorized transactions. According to Justice Department authorities, the transactions were worth at $71 million in bitcoin at the time, but with the currency’s value increasing, the amount is now more than $4.5 billion.
The 2017 bust of an underground digital market used to launder a portion of the proceeds may have provided a significant clue. According to US officials, part of the money was transferred to AlphaBay, a dark web-hosted version of eBay where anything goes.
When the site was taken down, officials were likely able to view AlphaBay’s internal transaction logs and link them to a cryptocurrency account in Lichtenstein’s name, according to the report.
The Bitfinex attack was one of the largest in crypto history, with 119,754 BTC worth approximately $4.5 billion at the time stolen five years ago.