US prosecutors are seeking a reduced sentence for Ilya Lichtenstein, the mastermind of the 2016 Bitfinex bitcoin heist, citing his significant cooperation in recovering the stolen assets. Lichtenstein faces prison time for stealing 120,000 bitcoins, worth $71 million at the time.
US Government Seeks Lighter Sentence for Bitfinex Hacker for Cooperation
Prosecutors are seeking a lighter sentence of 60 months for Ilya Lichtenstein, the hacker who orchestrated one of the largest bitcoin heists in history. In the filing, they acknowledge that Lichtenstein provided significant assistance in recovering some of the stolen bitcoin and unraveling the sophisticated money laundering operation behind the theft. Sentencing guidelines initially called for a longer prison term, but the government asked for a reduced sentence based on his cooperation. They also did the same for his wife, Heather Morgan.
Lichtenstein stole nearly 120,000 bitcoins from the Bitfinex exchange in August 2016. After illegally accessing the exchange's security system, he transferred the funds to a personal wallet. Over several years, Lichtenstein and his wife, Morgan, laundered the money using a variety of techniques, including complex transaction layering and the use of darknet markets and cryptocurrency mixers. Their scheme went undetected until their arrest in February 2022.
In August 2023, Lichtenstein pleaded guilty to a charge of conspiracy to commit money laundering. Prosecutors now argue that his detailed cooperation, which led to the recovery of significant assets, warrants a reduced sentence. Lichtensteinâs sentencing, scheduled for November 14, 2024, will set a precedent for how cooperation can impact sentencing in high-profile cryptocurrency crimes. Despite his cooperation, former Alameda Research CEO Caroline Ellison did not benefit significantly from the FTX trial.
What do you think about Lichtenstein's sentence? Please share your thoughts and opinions on this topic in the comments section below.
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