Ilya Lichtenstein, Bitfinex Hacker, Released Early Under Trump’s Reforms

Ilya Lichtenstein, known for laundering Bitcoin linked to the 2016 Bitfinex hack, has been granted early release from prison due to reforms under the First Step Act signed by former President Donald Trump.

Key Takeaways

Ilya Lichtenstein, involved in the 2016 Bitfinex hack, has been released early from prison.
His release is attributed to the First Step Act, which promotes rehabilitation and educational opportunities for inmates.
Lichtenstein was sentenced to five years in federal prison after pleading guilty, while his spouse, Heather Morgan, received an 18-month sentence.

Bitfinex hacker Ilya Lichtenstein freed early from prison.

Ilya Lichtenstein, a tech entrepreneur with dual U.S. and Russian citizenship, faced legal repercussions for laundering Bitcoin from a notorious cryptocurrency breach. His early release was enabled by reforms aimed at prison reform.

Early Release of Ilya Lichtenstein

Lichtenstein shared news of his early release on social media shortly after New Year’s Day, crediting the First Step Act for this opportunity. He mentioned his intention to pursue a career in cybersecurity and expressed gratitude towards his supporters.

In 2022, U.S. law enforcement apprehended Lichtenstein and his wife, Heather Morgan, as part of an investigation into Bitcoin associated with the 2016 Bitfinex hack. Prosecutors claimed that the couple conspired to hide and launder large quantities of Bitcoin taken during the breach, with the stolen amount valued in the billions at the time. This case has been considered one of the most significant cryptocurrency-related prosecutions in the U.S.

Lichtenstein faced sentencing in November 2024, where he received a five-year prison term after admitting guilt concerning the 2016 Bitfinex theft. His wife, Morgan, was sentenced to 18 months but was released in October after serving around eight months.

The reduction in Lichtenstein's sentence was facilitated by the First Step Act, a law enacted in 2018 that allows inmates to lessen their sentences by engaging in rehabilitation programs, educational courses, and other productive activities. This law continues to impact sentencing decisions in financial and cryptocurrency cases, especially when defendants cooperate with ongoing investigations.