Record-high seizure of $4bn in stolen Bitcoin

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A hacker made off with nearly 120,000 Bitcoin - now valued at about $5b - in 2016 after breaching the Bitfinex cryptocurrency exchangeImage source, Getty Images
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A hacker allegedly made off with nearly 120,000 Bitcoin - now valued at about $5bn - in 2016 after breaching the Bitfinex cryptocurrency exchange

Stolen Bitcoin worth more than $4bn (£2.9bn) has been seized by the US Department of Justice - the largest ever confiscation of its kind.

Officials also charged two people on Tuesday with attempting to launder the money, stolen by a hacker who breached a cryptocurrency platform in 2016.

The hacker allegedly made off with nearly 120,000 Bitcoin. Then valued at about $71m, its value now exceeds $5bn.

About 94,000 Bitcoin have been recovered.

Assistant Attorney General Kenneth Polite Jr said the seizure was proof the government "will not allow cryptocurrency to be a safe haven for money laundering or a zone of lawlessness within our financial system".

The money originates from the 2016 hack of a crypto exchange known as Bitfinex.

According to Justice Department officials, a hacker breached the platform, made more than 2,000 unauthorised transactions and then funnelled the money into a digital wallet allegedly run by Ilya Lichtenstein, 34, of New York.

A criminal complaint alleges Lichtenstein and his wife, Heather Morgan, 31, laundered about 25,000 of the stolen Bitcoin through various accounts over the past five years and used various methods to cover their tracks, from fake identities to converting their Bitcoin into other digital currencies.

Investigators from Washington DC, New York, Chicago and Ansbach, Germany collaborated on the lengthy probe.

In a statement, Bitfinex said it had cooperated with the inquiry and was "pleased" the stolen funds had been recovered.

Lichtenstein and Morgan will appear before a federal judge later on Tuesday, on counts of conspiracy to defraud the US and conspiracy to commit money laundering.

If found guilty, they could each serve up to 25 years in prison.

The asset seizure comes four months after the launch of a National Cryptocurrency Enforcement Team at the Justice Department.

In what is believed to be its previous largest financial seizure, the team seized some $2.3m in cryptocurrency last year, recovering the ransom paid by the Colonial Pipeline company to end a crippling cyberattack.

Correction 9th February: This article originally reported that the record seizure by the US Department of Justice amounted to $5bn in stolen Bitcoin. In fact 94,000 of the 120,000 stolen Bitcoin have been recovered, at a value of $4bn (£2.9bn) and so we have amended the article to make this clear.