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Cryptocurrency

The rapping economist arrested over a $7bn crypto hack wrote for Forbes on protecting yourself from cybercriminals

- February 10, 2022 2 MIN READ
Ilya Lichtenstein and Heather Morgan. Image: Twitter
A married couple has been arrested in the US for allegedly possessing and trying to launder 119,754 Bitcoin, today worth $7.4 billion, that were stolen in the 2016 breach of the Bitfinex exchange.

The US Justice Department arrested husband-and-wife duo Ilya Lichtenstein, 34, and Heather Morgan, 31, this week for their alleged involvement in laundering and profiting from the stolen Bitcoin.

Authorities seized around 94,000 Bitcoin when making the arrests.

“In a futile effort to maintain digital anonymity, the defendants laundered stolen funds through a labyrinth of cryptocurrency transactions,” US Deputy Attorney Lisa Monaco said in a statement.

“Thanks to the meticulous work of law enforcement, the department once again showed how it can and will follow the money, no matter what form it takes.”

Coins from the Bitfinex hack were transferred to a cryptocurrency wallet held by Lichtenstein.

The pair then allegedly moved 25,000 of the Bitcoin through a series of money laundering transactions in an attempt to hide the fact they were stolen.

This involved the use of fake identification to create online accounts, using bots to automate a high volume of transactions, depositing the coins in various dark web and clear net exchanges and marketplaces, and trading them for other cryptocurrencies.

For all the effort to wash the stolen Bitcoin, which took place over the five years since the initial breach, Lichenstein and Morgan couldn’t undo the fact that Bitcoin transactions are visible to everyone by design.

With enough time and effort law enforcement was able to unravel their web of money laundering transactions.

The 2016 hack of Bitfinex saw the exchange’s users lose significant Bitcoin holdings a time when the price of one Bitcoin was sitting just over US$610.

One Bitcoin is today worth US$44,500.

It has not been confirmed whether or not Lichtenstein and Morgan are suspected of orchestrating the breach.

Rather than hiding away with their vast fortune of ill-gotten cryptocurrency, Lichtenstein and Morgan lived in New York and were active as investors and influencers.

Morgan was a regular contributor for Forbes, including a June 2020 article titled ‘Experts Share Tips to Protect Your Business from Cybercriminals’.

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