The Department of Justice Seizes $3.6 Billion In BTC Stolen During The 2016 Bitfinex Hack.

The United States government has recovered around $3.6 billion in Bitcoin (BTC) stolen during a 2016 breach of the Bitfinex currency exchange, the biggest financial seizure ever, and detained two individuals, according to the country&rsquos Department of Justice (DOJ).

Heather Morgan and her husband, Ilya Lichtenstein, were detained recently and are set to appear in federal court in Manhattan soon. The two reportedly planned to launder a whopping 119,754 BTC that had been stolen after a hacker accessed Bitfinex&39s computer systems.

Crypto is not a safe space for criminals

"These arrests, together with the Departments biggest financial seizure to date, demonstrate that the cryptocurrency space is not a safe haven for any criminal or fraudulent entity," said Deputy Attorney General Lisa Monaco. The defendants had reportedly laundered stolen funds via a maze of cryptocurrency transactions in a fruitless attempt to retain digital anonymity, which is one of the main selling points of the crypto sector.

Bitfinex is the exchange associated with Tether (USDT), the worlds largest stablecoin. According to the Justice Department, the virtual currency haul was believed to be worth $71 million at the time of the attack. Now though, the total value of stolen BTC is currently at $4.5 billion.

Method of attack and future consequences

The duo was using advanced methods, including the use of fictitious identities to establish online accounts, complex software to automate transactions, a laundering strategy which enables many transactions to occur in a short period of time, and depositing the stolen money into accounts at a various digital currency exchanges as well as darknet markets, before finally withdrawing the funds.

Moreover, to conceal their transactions, Lichtenstein and Morgan used AlphaBay Marketplace, which had been shut down back in 2017. Some of the funds were withdrawn using BTC ATMs, whereas another portion of it was used to purchase NFTs and gold. The couple had even bought a Walmart gift card with the stolen funds.

For the money laundering charges, Lichtenstein and Morgan face a maximum of 20 years in prison. Furthermore, they risk an additional penalty of up to 5 years in jail for conspiracy to defraud the United States of America. The government is hopeful that this will set a precedent for the future and will actively discourage individuals and entities from taking advantage of the supposed anonymous nature of the crypto space.