News Bitfinex hacker sentenced to 5 years for laundering $10.5B in Bitcoin

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Bitfinex hacker sentenced to 5 years for laundering $10.5B in Bitcoin
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Former Bitfinex hacker Ilya Lichtenstein faces prison time for orchestrating the 2016 cryptocurrency exchange breach and subsequent money laundering scheme.


The US Department of Justice has sentenced Ilya Lichtenstein to five years in prison for his role in the 2016 Bitfinex hack that resulted in the theft of 119,754 Bitcoin, valued at $10.5B at current prices.

Lichtenstein, 35, breached Bitfinex's network security in 2016 using sophisticated hacking techniques to fraudulently authorize over 2,000 transactions, transferring the stolen Bitcoin to a cryptocurrency wallet under his control. His wife, Heather Rhiannon Morgan, who also pleaded guilty to related charges last year, awaits sentencing on November 18.

Money Laundering Methods
The couple employed complex money laundering methods to obscure the stolen funds' trail, including:

• Using fictitious identities for online banking
• Depositing assets in darknet markets
• Utilizing cryptocurrency mixing services like Bitcoin Fog

Blockchain analytics firm Chainalysis revealed that their purchase of Walmart gift cards using stolen Bitcoin led investigators to uncover their scheme.

Court documents show that Lichtenstein masterminded the Bitfinex hack independently, with Morgan joining as a "lower-level participant" later in the scheme. The pair converted portions of the stolen cryptocurrency through chain hopping, mixing services, and exchanges to fiat currency before moving funds to US bank accounts and purchasing gold coins.

Related Cryptocurrency Crime Developments

• Bitcoin Fog founder Roman Sterlingov's 12.5-year prison sentence
• Chinese national Daren Li's guilty plea for a $73.6M cryptocurrency investment scam

These cases highlight the Justice Department's intensified focus on prosecuting digital asset-related financial crimes.