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Bitfinex crypto hack overview:
- Who: Ilya Lichtenstein, 35, and Heather Morgan, 33, pleaded guilty to money laundering conspiracies.
- Why: The accused were caught related to the hack and theft of approximately 120,000 bitcoin from Bitfinex, a global cryptocurrency exchange.
- Where: The married couple are from New York City.
Ilya Lichtenstein, 35, and Heather Morgan, 33, pleaded guilty to money laundering conspiracies after they were accused of the Bitfinex crypto hack and theft of approximately 120,000 bitcoin from the global cryptocurrency exchange.
Approximately 95,000 stolen bitcoin were in the defendants’ cryptocurrency wallet when the couple was arrested in February 2022. The Bitfinex crypto hack funds were valued at approximately $3.6 billion. Later, authorities seized another approximately $475 million.
“Lichtenstein used a number of advanced hacking tools and techniques to gain access to Bitfinex’s network,” a press release on the Bitfinex crypto hack said. “Once inside their systems, Lichtenstein fraudulently authorized more than 2,000 transactions in which 119,754 bitcoin was transferred from Bitfinex to a cryptocurrency wallet in Lichtenstein’s control.”
Afterward, the defendant went into the Bitfinex system and deleted the access credentials and log files that showed he had accessed the system and then used his wife, Morgan, to help launder the funds.
The money laundering scheme the couple used was sophisticated as they used false identities and setup online accounts as they automated banking transactions by depositing the money into darknet markets and currency exchanges and then withdrew the funds to clear the trail of how the funds were obtained, according to case records.
The couple also used “chain hopping” by converting the stolen bitcoin into other forms of cryptocurrency, including anonymity-enhanced cryptocurrency.
Lichtenstein faces up to 20 years; Morgan pleaded to two charges for up to five years of prison each
Lichtenstein pleaded guilty to conspiracy to commit money laundering, with a maximum sentence of 20 years. Morgan, meanwhile, pleaded guilty to one count of money laundering conspiracy and one count of conspiracy to defraud the United States. Each charge carries a maximum penalty of five years in prison.
Ultimately, it will be up to a federal district court judge to determine the final sentence.
A former Amazon security engineer was arrested on charges he stole $9 million from a decentralized crypto exchange through a hack, laundering the stolen funds through a series of complex transfers on the blockchain.
Have you owned cryptocurrency? Let us know in the comments.
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