U.S. Backs Return of 2016 Bitfinex Stolen Bitcoin
The U.S. government, citing court filings, recommends that Bitcoin stolen from Bitfinex in 2016 be returned in its natural form as BTC coins..
On this page
The U.S. government has officially proposed returning over 94,000 Bitcoin, stolen in the 2016 Bitfinex hack, directly to the exchange.
Court documents filed this week in the U.S. District Court for the District of Columbia state that the stolen Bitcoin, tied to Ilya Lichtenstein and Heather Morgan (aka rapper “Razzlekhan”), was recovered in 2022. This remains the DOJ's largest asset recovery to date.
Source: Instagram
Bitfinex Set to Receive Full Restitution
The government has clarified that Bitfinex is the sole victim of the 2016 hack.
“The Court has the authority to order voluntary restitution pursuant to the defendants’ plea agreements,” the filling reads.
The recommendation is that all confiscated assets from the “Bitfinex Hack Wallet” be returned to the exchange.
This aligns with a mutual understanding reached in October 2024, in which Lichtenstein, Morgan, and iFinex recognized Bitfinex as the sole entity affected by this crime.
The Heist and Its Aftermath
In August 2016, Lichtenstein and Morgan allegedly masterminded the theft of 119,754 Bitcoin, then worth $71 million.
By 2022, when U.S. authorities seized the stolen assets, their value had risen to nearly $4 billion, reflecting the staggering scale of the theft and the importance of the recovery effort.
The duo admitted to conspiring to launder money in August 2023. Lichtenstein was sentenced to five years in prison, while Morgan received an 18-month sentence in November 2024.
Morgan’s case was particularly notable for her public role as a cybersecurity expert and her side career as a rapper who often spotlighted creative social engineering techniques.
Bitfinex’s Recovery Framework
In an earlier statement, Bitfinex pledged that 80% of the net proceeds from recovered Bitcoin would be allocated to repurchasing and burning UNUS SED LEO tokens. These debt tokens were launched post-hack to cover client losses.
The process is set to unfold over 18 months, aiming to significantly decrease the number of LEO tokens in circulation.
The content on The Coinomist is for informational purposes only and should not be interpreted as financial advice. While we strive to provide accurate and up-to-date information, we do not guarantee the accuracy, completeness, or reliability of any content. Neither we accept liability for any errors or omissions in the information provided or for any financial losses incurred as a result of relying on this information. Actions based on this content are at your own risk. Always do your own research and consult a professional. See our Terms, Privacy Policy, and Disclaimers for more details.
Articles by this author
