2016 Bitfinex hack

October 2025 Cryptocurrency theft The Bitfinex cryptocurrency exchange was hacked in August 2016. 119,756 bitcoins, worth about 72 million at the time, were stolen. In February 2022, the US government recovered and seized a portion of the stolen bitcoin, then worth 3.6 billion, by decrypting a file owned by Ilya Lichtenstein (born 1989) that contained addresses and private keys associated with the stolen funds.Case: 1 :22-mj-00022 - Complaint with Arrest Warrant https://www.justice.gov/opa/press-release/file/1470186/download February 7, 2022 February 10, 2022 February 9, 2022 https://web.archive.org/web/20220209011822/https://www.justice.gov/opa/press-release/file/1470186/download live Lichtenstein and his wife, Heather R. Morgan (born 1991), were charged with conspiracy to launder the stolen bitcoin. In August 2023, Lichtenstein admitted to committing the theft. Both Lichtenstein and Morgan pleaded guilty to money laundering.Paúl María Luisa 'Bitcoin Bonnie and Clyde' plead guilty in 'spy novel'-like laundering case https://www.washingtonpost.com/nation/2023/08/04/bitfinex-hack-guilty-plea/ Washington Post 5 August 2023 4 August 2023 In November 2024, Lichtenstein was sentenced to five years in a US prison for his involvement in money laundering the stolen bitcoin.Hoskins Peter US hacker sentenced over Bitcoin heist worth billions BBC Home 2024-11-15 https://www.bbc.com/news/articles/c2dl70wed1lo 2025-01-30 Morgan was sentenced to 18 months in prison for fraud and conspiracy charges.Davis Wes Razzlekhan, crypto's most embarrassing rapper, is going to prison The Verge 2024-11-18 https://www.theverge.com/2024/11/18/24299934/razzlekhan-crypto-bitfinex-hack-heather-morgan 2025-01-30 Hack In August 2016, the Bitfinex cryptocurrency exchange, based in Hong Kong, announced it had suffered a security breach.Bitfinex comes back from $69 million bitcoin heist Sfgate May 21, 2017 http://www.sfgate.com/business/article/Bitfinex-comes-back-from-69-million-bitcoin-heist-11161585.php live https://web.archive.org/web/20170522112449/http://www.sfgate.com/business/article/Bitfinex-comes-back-from-69-million-bitcoin-heist-11161585.php mdy-all 2017-05-22 Nakamura By Yuji Around 2,000 approved transactions were sent to a single wallet from users' segregated wallets.Chow Andrew R February 10, 2022 Inside the Chess Match That Led the Feds to $3.6 Billion in Stolen Bitcoin https://time.com/6146749/cryptocurrency-laundering-bitfinex-hack/ live February 12, 2022 Time https://web.archive.org/web/20220210131336/https://time.com/6146749/cryptocurrency-laundering-bitfinex-hack/ 2022-02-10 Immediately thereafter, bitcoin's trading price plunged by 20%, causing the value of the stolen bitcoins to dip to 58 million.Tsang Amie August 3, 2016 Bitcoin Plunges After Hacking of Exchange in Hong Kong The New York Times Hong Kong https://www.nytimes.com/2016/08/04/business/dealbook/bitcoin-bitfinex-hacked.html live https://web.archive.org/web/20170518201610/https://www.nytimes.com/2016/08/04/business/dealbook/bitcoin-bitfinex-hacked.html May 18, 2017 After learning of the breach, Bitfinex halted all bitcoin withdrawals and tradingShekhtman Lonnie August 3, 2016 Bitcoin security breaches raise questions about digital currency's future https://www.csmonitor.com/Business/new-economy/2016/0803/Bitcoin-security-breaches-raise-questions-about-digital-currency-s-future live https://web.archive.org/web/20170528013604/http://www.csmonitor.com/Business/new-economy/2016/0803/Bitcoin-security-breaches-raise-questions-about-digital-currency-s-future May 28, 2017 Christian Science Monitor and said it was tracking down the perpetrators of the hack.Bitcoin Worth $72M Was Stolen in Bitfinex Exchange Hack in Hong Kong http://fortune.com/2016/08/03/bitcoin-stolen-bitfinex-hack-hong-kong/ live https://web.archive.org/web/20161120085013/http://fortune.com/2016/08/03/bitcoin-stolen-bitfinex-hack-hong-kong/ November 20, 2016 October 26, 2016 Fortune Exchange customers, even those whose accounts had not been broken into, had their account balance reduced by 36% and received BFX tokens in proportion to their losses.Baldwin Clare Clare Baldwin August 6, 2016 Bitfinex exchange customers to get 36 percent haircut, debt token Reuters https://www.reuters.com/article/us-bitfinex-hacked-hongkong/bitfinex-exchange-customers-to-get-36-percent-haircut-debt-token-idUSKCN10I06H live June 20, 2018 https://web.archive.org/web/20190316072616/https://www.reuters.com/article/us-bitfinex-hacked-hongkong/bitfinex-exchange-customers-to-get-36-percent-haircut-debt-token-idUSKCN10I06H March 16, 2019 The exchange's access to U.S. dollar payments and withdrawals was then curtailed. The hack happened even though Bitfinex was securing the funds with BitGo, which uses multiple-signature security.2016-08-03 Bitcoin worth $72 million stolen from Bitfinex exchange in Hong Kong en Reuters https://www.reuters.com/article/us-bitfinex-hacked-hongkong-idUSKCN10E0KP 2021-10-14 2020-11-11 https://web.archive.org/web/20201111120442/https://www.reuters.com/article/us-bitfinex-hacked-hongkong-idUSKCN10E0KP live In July 2023, Bitfinex worked with the Department of Homeland Security to recover about $315,000 in cash and cryptocurrencies stolen in the 2016 breach. The funds will be redistributed to holders of Bitfinex's Recovery Right Tokens, digital coins issued to people who suffered financial losses due to the hack.https://www.bloomberg.com/news/articles/2023-07-06/crypto-exchange-bitfinex-says-315-000-from-2016-hack-recovered Crypto Exchange Bitfinex Says $315,000 From 2016 Hack Recovered Bloomberg July 6, 2023 www.bloomberg.com 2024-05-21 2023-07-07 https://web.archive.org/web/20230707213916/https://www.bloomberg.com/news/articles/2023-07-06/crypto-exchange-bitfinex-says-315-000-from-2016-hack-recovered live Laundering In early 2017, small amounts of the stolen bitcoins began to be moved from the wallet it had been initially stored in to the Dark Web marketplace AlphaBay with the intention of laundering it. After AlphaBay was shuttered by international law enforcement led by the FBI, the money was rerouted to the Russian marketplace Hydra. The shutdown of AlphaBay may have given law enforcement access to the service's internal transaction logs and allowed it to identify the perpetrators. In February 2022, a New York couple, Ilya Lichtenstein (aged 34) and his wife Heather R. Morgan (aged 31), were charged by US federal authorities with conspiring to launder the bitcoins, which was worth 5.3 billion at the time.Barrett Devlin Feds arrest couple, seize $3.6 billion in hacked bitcoin funds https://www.washingtonpost.com/national-security/2022/02/08/bitfinex-hack-bitcoin-arrests/ The Washington Post February 8, 2022 February 9, 2022 February 16, 2022 https://web.archive.org/web/20220216064314/https://www.washingtonpost.com/national-security/2022/02/08/bitfinex-hack-bitcoin-arrests/ live Lyngaas Sean February 8, 2022 Feds arrest a New York couple and seize $3.6 billion in stolen cryptocurrency 1 CNN News https://edition.cnn.com/2022/02/08/investing/cryptocurrency-laundering/index.html February 9, 2022 February 14, 2022 https://web.archive.org/web/20220214173633/https://edition.cnn.com/2022/02/08/investing/cryptocurrency-laundering/index.html live Lichtenstein was an entrepreneur who had co-founded a sales company called MixRank. Morgan was an entrepreneur, columnist for Inc., former Forbes digital contributor (from 2017 to 2021), and online rapper.Hissong Samantha 2022-02-08 Accused Bitcoin Mega Crook Made Rap Videos. And Dear God, Are They Cringey https://www.rollingstone.com/culture/culture-news/crypto-laundering-scheme-doj-1296783/ 2022-03-05 Rolling Stone en-US 2022-03-05 https://web.archive.org/web/20220305050726/https://www.rollingstone.com/culture/culture-news/crypto-laundering-scheme-doj-1296783/ live Dugan Kevin 2022-02-15 The Many Lives of Crypto's Most Notorious Couple How the accused bitcoin launderers spent their time. https://nymag.com/intelligencer/2022/02/the-many-shifting-sides-of-cryptos-most-notorious-couple.html 2024-05-13 New York Magazine en-US 2024-05-13 https://web.archive.org/web/20240513134409/https://nymag.com/intelligencer/2022/02/the-many-shifting-sides-of-cryptos-most-notorious-couple.html live Although neither were charged with committing the hack, law enforcement had acquired a search warrant for a cloud storage service used by Lichtenstein, obtaining a spreadsheet of wallet addresses and passwords linked to the hack.2022-02-09 US Justice's largest ever financial seizure sees two arrests over $3.6bn stolen crypto https://www.internationalinvestment.net/news/4044672/us-justice-largest-financial-seizure-arrests-usd-6bn-stolen-crypto live https://web.archive.org/web/20220217134348/https://www.internationalinvestment.net/news/4044672/us-justice-largest-financial-seizure-arrests-usd-6bn-stolen-crypto 2022-02-17 2022-02-17 InternationalInvestment en Though the stolen bitcoins could be tracked through public transactions logged on the blockchain, it was only after the wallet passwords were recovered that law enforcement could access and seize their contents.https://www.reuters.com/world/us/us-couple-accused-laundering-crypto-bitfinex-hack-reach-plea-deal-2023-07-21/ Crypto rapper 'Razzlekhan,' husband reach plea deal over Bitfinex hack laundering Luc Cohen Reuters July 21, 2023 www.reuters.com July 26, 2023 July 26, 2023 https://web.archive.org/web/20230726201027/https://www.reuters.com/world/us/us-couple-accused-laundering-crypto-bitfinex-hack-reach-plea-deal-2023-07-21/ liveIn Bitfinex Cryptocurrency Heist, 2 Charged Reach Plea Deal The New York Times 2023-07-21 https://www.nytimes.com/2023/07/21/nyregion/bitfinex-heist-laundering-plea-deal.html 2023-07-26 2023-07-26 https://web.archive.org/web/20230726195942/https://www.nytimes.com/2023/07/21/nyregion/bitfinex-heist-laundering-plea-deal.html live Some of the funds were moved to more traditional financial accounts and spent on gold, NFTs, Uber rides and a PlayStation.2022-08-16 The Ballad of Razzlekhan and Dutch, Bitcoin's Bonnie and Clyde https://www.vanityfair.com/news/2022/08/the-ballad-of-razzlekhan-and-dutch-bitcoins-bonnie-and-clyde 2022-08-18 Vanity Fair en-US 2022-08-18 https://web.archive.org/web/20220818101015/https://www.vanityfair.com/news/2022/08/the-ballad-of-razzlekhan-and-dutch-bitcoins-bonnie-and-clyde live Although hundreds of millions of dollars were converted to fiat currency, 80% of the bitcoins (approximately 94,000) remained in the original wallet at the center of the hack. In August 2023, Lichtenstein pleaded guilty to conspiracy to commit money laundering, and Morgan to one count of money laundering conspiracy and one count of conspiracy to defraud the United States. Lichtenstein additionally admitted to carrying out the hack. An information was filed against both defendants.Forkin Dan Mangan, Jim July 21, 2023 'Crypto Couple' appear set to plead guilty in bitcoin hack money laundering case https://www.cnbc.com/2023/07/21/crypto-couple-appear-set-to-plead-guilty-in-bitcoin-money-laundering.html live https://web.archive.org/web/20230725163021/https://www.cnbc.com/2023/07/21/crypto-couple-appear-set-to-plead-guilty-in-bitcoin-money-laundering.html July 25, 2023 July 26, 2023 CNBC In November 2024, Lichtenstein was sentenced to 60 months in prison and three years of supervised release.Bitfinex Hacker Sentenced in Money Laundering Conspiracy Involving Billions in Stolen Cryptocurrency November 15, 2024 https://www.justice.gov/usao-dc/pr/bitfinex-hacker-sentenced-money-laundering-conspiracy-involving-billions-stolen justice.gov Morgan was sentenced to 18 months in prison and three years of supervised release for fraud and conspiracy charges.Davis Wes 2024-11-18 Razzlekhan, crypto's most embarrassing rapper, is going to prison https://www.theverge.com/2024/11/18/24299934/razzlekhan-crypto-bitfinex-hack-heather-morgan 2024-11-19 The Verge en On December 6, 2024, Netflix released a documentary directed by Chris Smith featuring the story of Lichtenstein's and Morgan's crimes, titled Biggest Heist Ever.Brodsky Rachel 2024-12-06 The True Story Behind Netflix's 'Biggest Heist Ever' https://time.com/7200219/bitcoin-netflix-biggest-heist-ever/ 2025-01-30 TIME en In 2025, President Donald Trump signed an executive order to create a Strategic Bitcoin Reserve including Bitcoin seized by US law enforcement. In theory, this includes over 100,000 Bitcoin seized from the Bitfinex hackers, but the US Department of Justice has recommended to the courts that the Bitcoin seized after the hack be returned to Bitfinex.Fact Sheet: President Donald J. Trump Establishes the Strategic Bitcoin Reserve and U.S. Digital Asset Stockpile The White House 2025-03-07 https://www.whitehouse.gov/fact-sheets/2025/03/fact-sheet-president-donald-j-trump-establishes-the-strategic-bitcoin-reserve-and-u-s-digital-asset-stockpile/ 2025-03-22Establishment of the Strategic Bitcoin Reserve and United States Digital Asset Stockpile The White House 2025-03-07 https://www.whitehouse.gov/presidential-actions/2025/03/establishment-of-the-strategic-bitcoin-reserve-and-united-states-digital-asset-stockpile/ 2025-03-22Nandita Bose Jasper Ward Trump signs order to establish strategic bitcoin reserve Reuters 2025-03-07 https://www.reuters.com/technology/trump-signs-order-establish-strategic-bitcoin-reserve-white-house-crypto-czar-2025-03-07/ 2025-03-22McMahon Annabelle Liang & Liv Bitcoin reserve: Why has Trump set up a US crypto stockpile? BBC Home 2025-03-07 https://www.bbc.com/news/articles/cqx0g1py5v0o 2025-03-22US DOJ to return $9B in recovered Bitcoin from 2016 hack to Bitfinex MSN 2025-03-29 https://www.msn.com/en-us/money/other/us-doj-to-return-9b-in-recovered-bitcoin-from-2016-hack-to-bitfinex/ar-AA1xgzq5 2025-03-29 In January 2026, Lichtenstein was granted early release to supervised probation under the provisions of the First Step Act of 2018. The release was facilitated by the accumulation of earned time credits through vocational training provided by the Bureau of Prisons. Following his release, Lichtenstein publicly stated his intention to transition into a career in cybersecurity, citing the rehabilitative goals of the federal reform legislation.bitfinex hacker walks free crypto heist ends in early release https://www.cryptotimes.io/2026/01/02/bitfinex-hacker-walks-free-10b-crypto-heist-ends-in-early-release/ Cryptotimes.io See also History of bitcoin Strategic bitcoin reserve References 30em Category:Cryptocurrency theft Category:Money laundering Category:Robberies in the United States Category:2010s in hacking Bitfinex hack Bitfinex hack