- Bitfinex was one of the biggest crypto hacks in history, around 120,000 BTC was stolen
- Criminals broke transactions up into multiple small ones, using darknet markets and converting funds into other crypto
- Bitfinex to repay investors in UNUS SED LEO, LEO token rallied on the news
On Tuesday, February 8, federal officials seized bitcoin worth $3.6 billion linked to the 2016 hack of the crypto exchange Bitfinex, CoinDesk reported.
Agents arrested two people in New York on charges of money laundering connected to the monumental Bitfinex hack. The couple, Ilya “Dutch” Lichtenstein and Heather Morgan, will appear in court later today.
One of the biggest hacks in history
The Bitfinex hack was one of the biggest crypto hacks in history. Around 120,000 BTC was stolen, worth around $60 million at the time.
This amount would correspond to $4.5 billion at today’s prices, but the Department of Justice only seized about 94,000 BTC, worth $3.6 billion. No claim regarding the identity of the original hacker or hackers has been made.
The stolen bitcoin was moved to Dutch’s wallet via “unauthorized transactions”. Over the last 5 years, 25,000 BTC were transferred out. The others remained in his wallet.
According to the press release issued:
After the execution of court-authorized search warrants of online accounts controlled by Lichtenstein and Morgan, special agents obtained access to files within an online account controlled by Lichtenstein. Those files contained the private keys required to access the digital wallet that directly received the funds stolen from Bitfinex, and allowed special agents to lawfully seize and recover more than 94,000 bitcoin that had been stolen from Bitfinex. The recovered bitcoin was valued at over $3.6 billion at the time of seizure.
An attached statement of facts reads:
U.S. authorities traced the stolen funds on the BTC blockchain as proceeds from the hack moved out of the initial recipient wallet to wallets allegedly controlled by Lichtenstein and Morgan.
Allegedly, the defendants broke transactions up into multiple smaller ones, using darknet markets and converting funds into Monero and other cryptocurrencies. Further, authorities claim some of the funds went to an account connected to a company owned by Morgan.
Bitfinex to repay investors in UNUS SED LEO
Bitfinex assured that if the bitcoin is recovered, it would repay investors in UNUS SED LEO. The company announced:
If Bitfinex receives a recovery of the stolen bitcoin, as described in the UNUS SED LEO token white paper, Bitfinex will, within 18 months of the date it receives that recovery, use an amount equal to 80% of the recovered net funds to repurchase and burn outstanding UNUS SED LEO tokens. These token repurchases can be accomplished in open market transactions or by acquiring UNUS SED LEO in over-the-counter trades, including directly trading bitcoin for UNUS SED LEO.
The LEO token began rallying on the news, going from $4.97 to over $7 within an hour.
