Feds arrest 2 and seize $3.6 billion in bitcoin stolen in 2016 hack of Bitfinex


The U.S. Department of Justice announced Tuesday that it had seized $3.6 billion worth of bitcoin BTCUSD, -2.39% stolen in a 2016 hack of the currency exchange Bitfinex, and had arrested a husband and wife for their alleged role in the theft.

Prosecutors said they had managed to trace the stolen money — nearly 120,000 bitcoins — through an intricate web of transactions done to hide its origins, to a crypto-wallet controlled by Ilya Lichtenstein, 34, and his 31-year-old wife, Heather Morgan.

The pair were arrested Tuesday morning in Manhattan and were scheduled to appear in court later in the day on charges of conspiracy to commit money laundering and to defraud the U.S. government, authorities said. They have not been charged with perpetrating the hack itself.

The couple couldn’t immediately be reached for comment and it wasn’t clear if they had yet retained attorneys.

Not all of the bitcoin stolen in the 2016 hack has been recovered and the investigation is ongoing, prosecutors said. In all, it would be worth $4.5 billion today, they said.

“Today, federal law enforcement demonstrates once again that we can follow money through the blockchain, and that we will not allow cryptocurrency to be a safe haven for money laundering or a zone of lawlessness within our financial system,” said assistant Attorney General Kenneth Polite of the Justice Department’s Criminal Division. “The arrests today show that we will take a firm stand against those who allegedly try to use virtual currencies for criminal purposes.”

Prosecutors say the couple had been slowly laundering the money, having moved about 25,000 of the coins into regular cash currencies, gold and to purchase non-fungible tokens. Some of the money was used to purchase Walmart WMT, +0.77% gift cards which were, in turn, used to buy ordinary items.

This article was originally published by Marketwatch.com. Read the original article here.

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