Ilya Lichtenstein

US Hacker Sentenced to Five Years Over Multi-Billion-Dollar Bitcoin Heist

A U.S. federal court has sentenced Ilya Lichtenstein to five years in prison for laundering cryptocurrency stolen during the 2016 hack of the Bitfinex cryptocurrency exchange. The theft involved nearly 120,000 Bitcoin, one of the largest cryptocurrency heists in history.

At the time of the hack, the stolen Bitcoin was valued at approximately $70 million (£55.3m). By the time of Lichtenstein’s arrest in February 2022, the cryptocurrency’s value had surged to over $4.5 billion, and at today’s rates, it is worth more than double that.

Lichtenstein, who pleaded guilty last year, orchestrated the hack using sophisticated tools and enlisted the help of his wife, Heather Morgan. Morgan, who also admitted guilt, is scheduled to be sentenced on 18 November. She gained notoriety as “Razzlekhan,” a persona she used to promote her rap music, calling herself “the crocodile of Wall Street.”

According to prosecutors, Lichtenstein and Morgan employed elaborate laundering techniques to conceal the origins of the stolen Bitcoin. These included creating fictitious identities, converting funds into different cryptocurrencies, and purchasing gold coins. They even used couriers to transport laundered funds during family trips.

The U.S. Department of Justice (DOJ) recovered $3.6 billion worth of Bitcoin in the case, marking the largest financial seizure in its history, according to Deputy Attorney General Lisa Monaco.

“It’s important to send a message that you can’t commit these crimes with impunity, that there are consequences to them,” said District Judge Colleen Kollar-Kotelly during the sentencing.

Lichtenstein expressed remorse for his actions and stated his intention to use his skills to combat cybercrime after serving his sentence.

Morgan’s flamboyant online persona gained widespread attention during the case. Her music videos and articles, where she described herself as a “bad-ass money maker” and a technology entrepreneur, contrasted starkly with the criminal activities she was involved in.

The couple’s elaborate laundering scheme and Morgan’s viral social media presence have drawn attention to the evolving challenges of cybercrime and cryptocurrency theft.

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