The Bitcoin (BTC) that was stolen from crypto exchange Bitfinex in 2016 and subsequently seized by the US government in 2023 should be returned in-kind, according to a new court order.
In a January 14th filing with the U.S. District for the District of Columbia, the government says that the BTC currently held in its wallets is to be returned to Bitfinex, the “sole victim” of the hack.
The conclusion of the court order states,
“For the foregoing reasons, there is no ‘victim’ for the specific offenses of conviction in this proceeding. However, the Court has the authority to order voluntary restitution pursuant to the defendants’ plea agreements.
Such voluntary restitution should include all of the assets seized from the Bitfinex Hack Wallet and that, pursuant to the plea agreements, those assets should be returned to Bitfinex as in-kind restitution. All other seized assets listed in the Corrected Second Amended Attachment A (ECF 195) should be subject to the ongoing third-party ancillary forfeiture proceeding.”
Ilya Lichtenstein and his wife Heather Morgan were charged by the DOJ in 2022 in relation to the hack. The government says that Lichenstein stole approximately 119,754 BTC from Bitfinex, and then withdrew and laundered about 25,000 coins.
Lichenstein also wrongfully gained from the several Bitcoin forks such as Bitcoin Cash (BCH), Bitcoin Satoshi Vision (BSV) and Bitcoin Gold (BTG).
After the government seized the Bitcoin in January 2022, Lichenstein’s wallet still contained 94,643 coins. According to the court order, those coins are now to be returned to Bitfinex in-kind rather than first being sold for US dollars.
Lichtenstein recently appeared as a cooperating US government witness in an ongoing money laundering trial centered around the crypto mixing service Bitcoin Fog, according to a Bloomberg report.
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