DOJ Seizes $3.7 Billion in Cryptocurrency in Largest Financial Seizure Ever
The Justice Department has seized over $3.6 billion worth of stolen Bitcoin and arrested Ilya Lichtenstein and Heather Morgan, a married couple accused in a criminal complaint of conspiring to launder 119,754 Bitcoin that had been stolen in 2016 from Hong Kong-based Bitfinex, one of the world’s largest virtual currency exchanges, six years ago by hackers, reports the New York Times. The complaint also accuses the couple of conspiracy to defraud the United States after the hacker who breached Bitfinex’s systems initiated 2,000 transactions to send 119,754 stolen Bitcoin to a digital wallet that was under Lichtenstein’s control.
Over the last five years, about 25,000 of those Bitcoin were transferred out of Lichtenstein’s wallet using a complicated series of transactions meant to obscure that the currency had been stolen from Bitfinex, some of which was eventually deposited into financial accounts controlled by Lichtenstein and Morgan. Investigators seized the 94,636 Bitcoin that remained in that wallet, which were worth more than $3.6 billion. The 119,754 total Bitcoin that were stolen, worth about $71 million when Bitfinex was hacked in 2016, are now worth more than $4.5 billion. While regulators have brought some large exchanges like this in the United States under official oversight, most cryptocurrencies move through decentralized computer networks that are not under the control of any single government or company, resulting in largely unregulated and problematic exchanges that threaten to impair consumer confidence in cryptocurrencies and to slow widespread adoption.
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