Record Seizure of $4 Billion in Stolen Bitcoin

The US Department of Justice seized more than $4 billion worth of stolen bitcoins (£2.9 billion), the largest such seizure ever made.

Officials also charged two people Tuesday with trying to launder the money, stolen by a hacker who breached a cryptocurrency platform in 2016.

The hacker allegedly made off with nearly 120,000 Bitcoin. Valued then at about $71 million, its value now exceeds $5 billion. About 94,000 Bitcoin have been recovered.

Deputy Attorney General Kenneth Polite Jr said the seizure was proof that the government “will not allow cryptocurrencies to be a safe haven for money laundering or a zone of lawlessness within our financial system.”

The money comes from the 2016 hack of a crypto exchange known as Bitfinex. According to Justice Department officials, a hacker entered the platform, made more than 2,000 unauthorized transactions, and then funneled the money into a digital wallet allegedly managed by Ilya Lichtenstein, 34, of New York.

A criminal complaint alleges that Lichtenstein and his wife, Heather Morgan, 31, laundered around 25,000 stolen bitcoins through various accounts over the past five years and used various methods to cover their tracks, from false identities to converting their bitcoins. in other digital currencies.

Researchers from Washington DC, New York, Chicago and Ansbach, Germany collaborated on the lengthy investigation. In a statement, Bitfinex said it had cooperated with the investigation and was “pleased” that the stolen funds had been recovered.

Lichtenstein and Morgan will appear before a federal judge later Tuesday on charges of conspiracy to defraud the United States and conspiracy to commit money laundering. If convicted, they could each serve up to 25 years in prison.

The asset seizure comes four months after the launch of a National Cryptocurrency Enforcement Team at the Department of Justice.

In what is believed to be its largest previous financial seizure, the team seized some $2.3 million in cryptocurrency last year, recovering the ransom paid by the Colonial Pipeline company to end a crippling cyberattack.