DOJ Seizes Billions in Stolen Bitcoin

🪙 Heather Morgan, 31 years old, and her husband Ilya Lichtenstein, 34, were arrested in Manhattan yesterday for an alleged conspiracy to launder $4.5 billion worth of cryptocurrency stolen during the 2016 Bitfinex hack.

Officials have recovered more than $3.6 billion so far, the DOJ’s largest seizure ever.

• Bitfinex, a Hong Kong-based digital-currency exchange, was hacked in 2016. The thieves made off with nearly 120,000 bitcoin, valued around $70 million at the time.
• The stolen bitcoin was funneled to a digital wallet being controlled by Mr. Lichtenstein. From there, the pair allegedly employed “numerous sophisticated laundering techniques” to wash the money before making a mistake last February.
• The techniques included using fictitious identities to set up online accounts, utilizing computer-based programs to automate transactions, and depositing stolen funds into accounts across multiple exchanges and darknet markets – a process commonly known as “layering” – to obfuscate the trail of the transaction history.

👀 Looking ahead… The pair face a maximum sentence of 20 years in federal prison for the money laundering charge, plus five more for conspiring to defraud the US government.

+Something ironic we found: You can read this article – published by Forbes and still live on their site – by Heather Morgan, titled “Tips to Protect Your Business from Cybercriminals.” (Tbh, she’s probably got some good tips.)

+Dig deeper: Read more about the accused Heather Morgan, a "Serial Entrepreneur, SaaS Investor and Surrealist" who also has a rapper alter ego named “Razzlekhan.