Bitfinex’s Bitcoin Hacker is Finally Exposed!
- The identity of the 2016 Bitfinex Bitcoin hacker has finally been exposed for the first time in almost 7 years.
- Lichtenstein converted some of the stolen Bitcoins to gold, while Morgan hid some gold coins at unknown locations.
- The couple attempted several measures to cover their tracks before their arrest in 2022.
A New York man has confessed to being the brain behind the infamous 2016 hack of crypto exchange Bitfinex. The Bitcoin theft remains one of the biggest crypto hacks in history and is said to be worth a whopping $4.5 billion.
Barely a month after agreeing to forfeit billions from laundering funds from the Bitfinex hack as part of a plea deal, 35-year-old Ilya “Dutch” Lichtenstein has confessed to being the hacker. Lichtenstein made this confession while pleading guilty to laundering the stolen bitcoin in a federal court on Thursday.
Authorities have long suspected that either Lichtenstein or his wife, Heather Morgan, stole the bitcoins. Interestingly, Morgan pleaded guilty to money laundering conspiracy and a conspiracy to defraud the United States government. Morgan, known by her stage names “Razzlekahn” and “The Crocodile of Wall Street,” could spend up to five years behind bars for the charges against her.
The 33-year-old, who has been free on a $3 million bond since her arrest, was in the courtroom during Lichtenstein’s hearing. It also marked the first time the criminal couple had seen each other in a year.
According to reports, Lichtenstein could face up to 20 years in prison for one count of conspiracy to commit money laundering. He was arrested earlier last year and has been held without bail after the judge deemed him a flight risk.
US prosecutors are said to have seized more than 94,000 of the 119,000 hacked bitcoins from Liechtenstein and Morgan during their arrest last year. Speaking in a press conference on Thursday, DOJ officials said that the government “has seized another approximately $475 million tied to the hack.”
Lichtenstein Attempted to Launder His Bitcoin Theft
Explaining Lichtenstein’s criminal operation, DOJ officials noted that “Lichtenstein used a number of advanced hacking tools and techniques to gain access to Bitfinex’s network.” They added that once he gained access to the system, “Lichtenstein fraudulently authorized more than 2,000 transactions in which 119,754 bitcoins were transferred from Bitfinex to a cryptocurrency wallet in Lichtenstein’s control.”
The DOJ further explained that Lichtenstein attempted to cover his tracks by heading into Bitfinex’s network to delete access credentials that could identify him. Prosecutors added that the 35-year-old sought the help of his wife, Morgan, to launder the illegal funds.
Today’s admission brings an end to years of speculation about the identity of the Bitfinex hacker. Interestingly, at the time of the hack, the stolen Bitcoin was only worth $70 but has since soared into billions, showing the popularity of cryptocurrencies over the past five years.
Reacting to Thursday’s news, Bitfinex said in a statement:
Following the August 2016 hack, Bitfinex engaged in unprecedented efforts to make its customers whole. Bitfinex also diligently worked with the U.S. Department of Justice to identify the perpetrators of the hack, recover the stolen bitcoin, and bring the hackers to justice. After seven years, those efforts have come to fruition.
During Thursday’s plea hearing, it was revealed that Lichtenstein and Morgan deployed different tactics to hide their theft. Lichtenstein reportedly converted some of the assets to gold while his wife buried gold coins at undisclosed locations.
Interestingly, Netflix has reportedly commissioned a series on the couple’s operations following their arrest last year.
Lawrence has covered some exciting stories in his career as a journalist, he finds blockchain-related stories very intriguing. He believes Web3 will change the world and wants everyone to be a part of it.
