Ilya Lichtenstein has received a five-year prison sentence for his role in a money laundering scheme linked to a significant 2016 hack of the Bitfinex cryptocurrency exchange, during which approximately 120,000 bitcoins were stolen.
Court records reveal that Lichtenstein infiltrated Bitfinex’s systems and executed over 2,000 transactions that transferred 119,754 bitcoins to a wallet under his control. At the time of the theft, the stolen cryptocurrency was valued at around $70 million, but its worth has since skyrocketed to about $10.5 billion.
After executing the hack, Lichtenstein involved his wife, Heather Morgan, in efforts to launder the illicit funds. Their methods included creating fake identities to establish online accounts, utilizing automated software for transactions, and funneling funds through darknet markets and various cryptocurrency exchanges. They also engaged in converting bitcoins into other cryptocurrencies, used crypto mixing services, legitimized their financial activities with business accounts based in the U.S., and exchanged portions of the stolen funds for gold coins.
In August, both Lichtenstein and Morgan pled guilty to conspiracy to commit money laundering. Morgan is expected to receive her sentencing later this month.