Heather Morgan, the aspiring rapper who helped her husband steal billions of dollars in Bitcoin from crypto exchange Bitfinex in 2016, will serve an 18-month prison sentence, according to news reports.
Better known by the alias Razzlekhan, Morgan was sentenced Monday at a federal courthouse in Washington.
It wasn’t the outcome she’d hoped for: Morgan had requested that she be sentenced to the time she has already served, according to court papers.
But it was far less than her husband, Ilya Lichtenstein. In a hearing last week, Lichtenstein was sentenced to five years in prison, according to news reports.
Hacking tools
Lichtenstein used “advanced hacking tools and techniques” to fraudulently authorise the transfer of roughly 120,000 Bitcoin from Bitfinex to a wallet he controlled, according to prosecutors.
Lichtenstein then tried to erase his digital footprints and eventually enlisted Morgan in laundering the stolen tokens.
That Bitcoin would be worth $10.9 billion at Monday’s prices.
Authorities arrested the married couple and seized about 95,000 Bitcoin worth $3.6 billion in 2022.
The case immediately went viral thanks to Morgan’s alter ego, Razzlekhan, a self-described “surrealist and shameless rapper” who was all over YouTube.
Morgan didn’t know about the hack until 2020, according to prosecutors.
Initial consent
“She was in some ways thrust into the middle of a serious criminal scheme without her initial consent,” prosecutors said in a letter to US District Judge Colleen Kollar-Kotelly.
“[She] undoubtedly felt compelled to support it out of a sense of loyalty to her husband and desire to preserve their life together.”
The couple used fictitious identities, accounts on darknet markets and exchanges, and chain-hopping to anonymise and conceal the stolen Bitcoin, prosecutors said.
The couple even converted some Bitcoin into actual gold. But their machinations weren’t enough to prevent FBI cybersleuths from tracking the stolen crypto to the New York couple.
“I am extremely sorry and deeply regret the choices I made,” Morgan said during Monday’s sentencing hearing, CoinDesk reported.
“I used my time and energy to do harm instead of good, and I’m ashamed of that.”
‘I’m sorry I’ve been gone for a little while. The last three years, I was battling a fed case.’
Heather Morgan
Monday evening, Morgan posted on X for the first time in two years.
“I’m sorry I’ve been gone for a little while. The last three years, I was battling a fed case, and I like to listen to my lawyers,” she said in a brief video.
“Well, guess what. It’s over, and I’m very excited that I will soon be telling my story, sharing my thoughts, and telling you more about the creative and other endeavours I’ve been working on. Razzle dazzle.”
The Bitfinex heist inspired Amazon MGM Studios to start development of a film about Lichtenstein and Morgan.
Aleks Gilbert is a DeFi correspondent based in New York. Have a tip? Contact him at aleks@dlnews.com.
