Mastermind of $4.5 Billion Bitfinex Hack Released Early Thanks to Trump Law

Ilya Lichtenstein, a key figure in the notorious $4.5 billion hack of the Bitfinex exchange, which resulted in the theft of nearly 120,000 Bitcoin, has been released from prison early due to a law established during President Donald Trump’s administration.

Key Takeaways

Ilya Lichtenstein, tied to the $4.5 billion Bitfinex hack, was released early under Trump’s First Step Act.
He and his wife, Heather Morgan, were arrested for laundering stolen Bitcoin and both pleaded guilty to various charges.
Their cooperation with authorities led to reduced sentences and early releases.
Trump's administration has shown leniency toward other crypto offenders, drawing political criticism and raising concerns about public safety.

Mastermind Behind $4.5 Billion Bitfinex Hack Walks Free with Trump Pass

The 35-year-old hacker expressed gratitude for Trump’s First Step Act in a post on X, stating his intention to contribute positively to the field of cybersecurity and to prove his critics wrong.

The First Step Act, which Trump signed into law in 2018, allows incarcerated individuals to earn early release by participating in rehabilitation programs and engaging in productive activities.

From Tech Entrepreneur to Federal Criminal

Ilya Lichtenstein and his wife, Heather Morgan, were apprehended in New York in February 2022 after authorities linked their wealth to the massive crypto heist.

Morgan built a public persona as a successful tech entrepreneur, referring to herself in Forbes articles as an “economist, serial entrepreneur, software investor, and rapper” while secretly assisting her husband in laundering the stolen cryptocurrency from Bitfinex.

The couple both pleaded guilty to charges of money laundering, with Morgan facing an additional charge of conspiracy to defraud.

Court documents reveal that they used false identities and transferred funds in small amounts to escape detection, employing advanced techniques to cover the digital trails of their illicit wealth.

Bitfinex Hack

Cooperation Leads to Lighter Sentences

Morgan’s legal team effectively argued for her time served in a federal court in Washington, D.C., citing dire pretrial conditions, including recovery from surgery and contracting COVID-19.

She was released on personal recognizance, allowing her to remain free without bail until her sentencing hearing last year.

In October 2024, Morgan received an 18-month sentence but was released after serving about eight months due to their cooperation with U.S. authorities in other cryptocurrency prosecutions. This collaboration significantly reduced their potential prison time, which could have otherwise extended for decades for orchestrating one of the largest crypto thefts in history.

Following her sentencing, Morgan shared her excitement in a video posted to X, stating: “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 endeavors I’ve been working on.”

Trump's Crypto Clemency Faces Criticism

Lichtenstein’s early release is part of a broader pattern of leniency towards cryptocurrency offenders during Trump’s tenure.

In March 2025, Trump pardoned the founders of BitMEX—Arthur Hayes, Benjamin Delo, Samuel Reed, and employee Greg Dwyer—who had all pleaded guilty in 2022 to violations of the Bank Secrecy Act for lacking adequate anti-money laundering protections within their crypto derivatives platform.

Binance founder Changpeng Zhao also received a presidential pardon in October after pleading guilty to similar violations concerning the failure to enforce effective anti-money laundering measures at his exchange, the largest cryptocurrency platform in the world.

Trump has also indicated a willingness to consider pardoning Keonne Rodriguez, CEO of the privacy-focused Bitcoin wallet Samourai, who was sentenced in December to five years for money laundering.

During an Oval Office event on December 16, Trump commented on Rodriguez’s case, saying: “I’ve heard about it, I’ll look at it. It sounds like, based on your question, Rodriguez. We’ll look at that, Pam,” while addressing U.S. Attorney General Pam Bondi.

California Governor Gavin Newsom has ramped up criticism of Trump’s pardon strategies, launching a state-backed website documenting what his office refers to as Trump’s “top criminal cronies.”

This site also cites Ross Ulbricht, the founder of Silk Road, who received a life sentence for his role in drug trafficking and money laundering that involved over $214 million in illegal Bitcoin transactions. In addition, new crime data indicates continued declines across major cities in California.

This series of pardons and appeals has ignited significant political pushback, framing the issue of crypto clemency as part of a larger discussion surrounding corruption, public safety, and the growing influence of digital assets in American politics.