By Mark Hunter
19 hours agoFri Oct 25 2024 09:17:34
Reading Time: 2 minutes
- Over $20 million in cryptocurrency seized in the 2016 Bitfinex hack has reportedly been stolen from a U.S. government-controlled wallet
- Blockchain analysis indicates funds moved in several transactions to wallets and exchanges in suspected laundering attempts
- Ilya Lichtenstein and Heather Morgan were previously arrested in connection with laundering funds from the Bitfinex hack
A hacker appears to have stolen approximately $20 million in Ethereum and stablecoins from a U.S. government wallet, likely related to assets seized in the investigation of the 2016 Bitfinex hack. Blockchain analysts from Arkham Intelligence noticed suspicious movements on October 24, tracking the transfer of crypto assets that authorities had confiscated from Ilya Lichtenstein and Heather Morgan, who were arrested in 2022 for allegedly laundering funds from the Bitfinex hack. The transactions seem to involve laundering strategies, but the U.S. government has yet to release an official response.
The Hack That Keeps on Giving
In 2016, the Bitfinex exchange suffered a breach in which hackers stole approximately 119,756 Bitcoin, valued at about $72 million at the time but worth billions today. Bitfinex, one of the largest exchanges, later cooperated with authorities to recover as much of the stolen funds as possible.
Following years of investigation, the U.S. Department of Justice seized a substantial portion of the stolen Bitcoin and arrested two suspects, Lichtenstein and Morgan, who allegedly moved portions of the funds through complex laundering methods, with Lichtenstein also pleading guilty to carrying out the hack.
$20 Million Stolen?
On October 24, the U.S. government-controlled wallet, linked to seized Bitfinex hack assets, showed significant fund movements—initially dormant for months, the wallet suddenly transferred $1.25 million in USDT and $5.5 million in USDC. Subsequent transactions included $13.7 million in aUSDC and $446,000 in Ethereum, leading analysts to believe the funds were being laundered through multiple wallets and exchanges:
TLDR it’s a likely theft as funds tied to the USG started going to instant exchanges like N exchnage, Switchain, and Binance nested service.
0x3486ee700ccaf3e2f9c5ec9730a2e916a4740a9f
0xbf6f7c503e858aded4e18ce2bcf93846fd726c15
0x15d0a31ed5050ed8decd3c101aaee0b2ad2e6441 pic.twitter.com/WEdIVKI40u
— ZachXBT (@zachxbt) October 24, 2024
While U.S. authorities have yet to comment, the breach raises critical questions about the security of seized crypto assets under government control, with investigations likely to focus on identifying how the hacker accessed the wallet. In July, the U.S. Marshals Service (USMS), a division of the U.S. Department of Justice responsible for asset forfeiture, announced that Coinbase Prime had been chosen to manage custody and advanced trading services for its “Class 1” large-cap digital assets and questions will surely be asked of its controls following the theft.
