The story begins with the location where the bitcoin was stolen from Bitfinex. Since its inception in 2012, the Bitfinex exchange has had a shady history, from hacks to cover up losses, being unable to find banks, and CFTC fines, but the worst disaster occurred in 2016 when their Hong Kong exchange was hacked, and nearly 120 000 bitcoin were stolen directly from users' wallops. It was chaos, withdrawals were halted, and trading was halted. The Bitfinex exchange, where individuals exchanged bitcoin, was hacked, and trading was halted after word of the incident spread. To be clear, it wasn't the bitcoin blockchain that was hacked, but rather the Bitfinex exchange where people traded bitcoin. Customers' balances were reduced by 36 per cent as a result of the hack, and they were given tokens in proportion to their losses. The crypto community was on the case, and everyone was curious who the hackers were, but it would take several years to finally track them down details of how the hack happened. Even after all these years, I'm not quite clear, but one of the leading theories is something like this. Because Bitfinex used a third-party service called BitGo to secure its users' wallets, the breach was conceivable. The BitGo servers were compromised, and the hacker directed the system to send all of the bitcoin to an account of their choosing for years.
Following the hack, the crypto community kept a close eye on the stolen coins' movements through the blockchain. Everyone could see where the coins were going, but no one knew who the owners were. Before long, these coins were banned and blacklisted from other crypto exchanges all over the blockchain, which meant the hackers couldn't convert the bitcoin into fiat currency. A total of 25 000 coins out of 120 000 were tossed around in a complicated laundering procedure. Some of the stolen bitcoin was used to buy gift cards for Uber, Walmart, and Playstation, and some of the laundered bitcoin was even used to buy gold and NFTs, which was all very strange. Some keen blockchain analysts believe that some of the stolen bitcoin was paid into so-called cash-out service on the darknet, where a user would pay someone on the darknet with bitcoin and receive an equivalent amount of cash, minus a fee, that was put in a vacuum-sealed bag and left in a secret location.
The user would then be given exact GPs coordinates as to where to pick it up, as for the rest of the stolen bitcoin, it just sat there for another 4.5 years due to all of the blacklisting, it was too risky to move there were just too many eyes on it, that is until August of 2021 when 760 million dollars mysteriously moved from the original hacker's wallet to a new crypto wallet, it appeared that the perpetrators had finally gotten tired of sitting on the coins and They were hoping to make a break for it.
With special tools like elliptic the complicated movement of coins was tracked after an investigation it had been found that the crypto wallet belonged to 34-year-old startup founder Ilya Lichtenstein Liechtenstein and his wife heather Morgan aged 31 allegedly conspired to launder the coins consistent with the
branch of justice government-controlled to hyperlink the stolen cash to crypto trade money owed owned below the couple's names so who were these two now this is often where things get really interesting ironic and just downright bizarre Liechtenstein was a Russian us national he grew up in Chicago and attended the University of Wisconsin consistent with people who knew him he was described as quiet and observant but he had a guarded wall around him. While Liechtenstein was a co-founder of a blockchain startup before his arrest, the main target has shifted to his wife Heather Morgan, a former Forbes contributor who ironically wrote articles on a way to protect your business from cybercriminals and advised crypto exchange owners on a way to avoid fraud. She even gave a cyber security talk with BitGo, which was the identical third-party platform that didn't protect the Bitfinex wallets during the hack, but that's another storey.
She gave a seminar in 2019 about the way to socially engineer yourself into anything. a number of the information she gave included pretending to call a fake friend while at an occasion, checking au fait important names to realize entry into exclusive parties, and following closely and listening and learning about your target. in line with the seminar description, she employed social engineering to traverse and enter underground markets and shadow economies in her prior job, thus these talents may are useful in gaining access to Bitfinex's security.
Heather spent her twenties travelling the planet and learning multiple languages, including Japanese, Korean, Russian, Turkish, Arabic, and Cantonese. In 2014, she founded sales folk, a corporation that aims to assist other businesses to improve their pitch efficiency. it had been later discovered that sales folk was involved in a very hiding scheme. Heather published 47 articles for Forbes as a quote Forbes lady between December 2017 and September 2021, in keeping with Vice, who questioned those who knew her. They were all shocked at the news they called heather a pleasant person and was highly driven However, the Department of Justice warns people to not be misled, claiming that she played an important role within the concealing and fraud plan. They also claim she had considerable knowledge of bitcoin protocols, and utilized them to launder money, claiming she wasn't an unknowing spectator.
The couple travelled to Ukraine in 2019 to make fake identities and passports. They founded financial accounts in Russia and Ukraine, and appear to possess been attending to leave the US and head to the east if things got too heated. Unfortunately for them, covert action put an end to those plans. The Ukrainian activities, federal agents would remark, appear as if something out of a spy thriller. US enforcement got an exploration order for Liechtenstein's digital wallet and was ready to seize the remaining 3.6 billion by decrypting a get in his cloud storage account. The encrypted go into the cloud contained 2 000 crypto wallet addresses and their corresponding private keys.
There has been no explanation of how enforcement encrypted the file, though investigators were able to link those wallets to the initial Bitfinex attack through blockchain analysis, and other incriminating documents were discovered on dark websites that sold phoney ids and passports. The couple did use a VPN, but they used their real names, email addresses, and residential addresses to get the stolen bitcoin. the sport was up, and only about 4% of the bitcoin was successfully laundered. in step with the Department of Justice, the couple was arrested on Tuesday morning, February 8th, 2022 in NY.
The two are charged with conspiracy to commit hiding which carries a maximum sentence of 20 years in prison and conspiracy to defraud the US which brings a maximum sentence of 5 years a Manhattan judge has set Lichtenstein's bail at 5 million and Heather Morgan's at 3 million some people have raised some doubts could this couple really attain a 4.6 billion heist although the department of justice has not publicly linked them to the particular hacking of the cryptocurrency exchange they were heavily implied to possess done it since the stolen coins were recently directed to a wallet that they owned and also the money wasn't break up between anyone else.
It's thought that they were involved in how, but it doesn't rule out the possibility that others were involved further. Some internet sceptics point to the arrest of two Israeli brothers in regard to the hack in 2019, although there has been no additional information on judicial procedures since then. Others claim that the married pair was founded as patsies by the FBI or another authority, but we've got no proof to support this claim.
While there's some ambiguity within the charges brought by the Department of Justice, it appears that every one evidence points to the eccentric family. In court proceedings, it had been revealed that they'd a bag labelled quote burn phones under their bed and a computer folder labelled fake passport ideas.
So there you have it, that's the storey of how an eccentric married couple embarked on a six-year digital quest through the blockchain in cyberspace, where the two suspects were not only weird but also lurking in plain sight. What are your thoughts on this subject?