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A federal judge sentenced Ilya Lichtenstein to five years in prison Thursday for orchestrating one of history's largest cryptocurrency heists, involving bitcoin worth over $7.6 billion at current prices.
Judge Colleen Kollar-Kotelly emphasized the calculated nature of the 2016 hack of Hong Kong-based exchange Bitfinex, stating, "It's important to send a message that you can't commit these crimes with impunity."
Lichtenstein, a Russian-born US citizen, admitted to stealing approximately 120,000 bitcoin – valued at $71 million when stolen. Federal prosecutors revealed he spent months planning the intrusion before executing what IRS agents described as "the most complicated money laundering techniques they had seen to date."
"Over half a decade, the defendant engaged in what IRS agents described as the most complicated money laundering techniques they had seen to date," prosecutors noted in court documents.
The scheme involved his wife, Heather Morgan, who performed rap songs under the name "Razzlekhan" while helping launder about 21% of the stolen funds. The couple successfully converted at least $14 million before their 2022 arrest in New York City.
Barry Berke, representing Bitfinex, told the court the hack "devastated" the company's finances and reputation, with the stolen funds representing 36% of its assets at the time.
Defense attorney Samson Enzer portrayed Lichtenstein as "not an evil person" but rather "a good person who made some very bad mistakes." Following his arrest, Lichtenstein cooperated with authorities on other cybercrime investigations, helping recover over 96% of the stolen cryptocurrency.
At Thursday's hearing, Lichtenstein expressed remorse: "I want to take full responsibility for my actions and make amends any way I can." He pledged to use his expertise to combat cybercrime after serving his sentence.
Morgan, who pleaded guilty to money laundering conspiracy, faces sentencing Monday. Prosecutors have recommended an 18-month sentence, noting she was "a lower-level participant" who initially assisted "without explaining exactly what he was doing."
The case marked the largest financial seizure in Department of Justice history, with recovered assets worth billions in today's market.
