5 intriguing details about Ilya Lichtenstein and Heather Morgan's Bitcoin heist

'Bitcoin Bonnie and Clyde', Ilya Lichtenstein and Heather Morgan have been recently prosecuted for pulling one of the biggest Bitcoin heists in history. Their story is the subject of Netflix's latest documentary, Biggest Heist Ever, released on December 6, 2024.

The documentary will explore the complexity of the couple's crimes and the advanced tools they used to commit a cybercrime of such magnitude and avoid detection for a long time.

Lichtenstein and Morgan were charged with conspiracy to commit money laundering and conspiracy to defraud the United States. They have been sentenced for stealing bitcoins which added up to $4.5 billion in 2022.

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5 intruiging details about Ilya Lichtenstein and Heather Morgan's bizarre Bitcoin heist

1.Ilya Lichtenstein: The mastermind behind the hack

In 2016, $72 million worth of bitcoin was stolen from the Hong Kong-based virtual cryptocurrency exchange, Bitfinex, which sent the entire crypto ecosystem crashing and the value of the currency fell about 20%.

The hack led to several customers, who had invested their life savings, losing thousands of dollars overnight. This hack was pulled off by Russian-born entrepreneur and crypto investor Ilya Lichtenstein.

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2. Lichtenstein was aided by Heather Morgan

Biggest Heist Ever promotional picture (Image via Netflix)

Heather Morgan is a 34-year-old columnist and aspiring rapper who married Lichtenstein after meeting him at a tech conference. Morgan pursues her rap career under the alias Razzlekhan and she films YouTube videos with crypto-themed raps.

Morgan was not initially aware of her husband's hacking but when she learned about it she helped him launder millions of dollars. In one of her rap songs, she even refers to herself as the "Crocodile of Wall Street” and "bad-*ss money maker".

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3. How 'Bitcoin Bonnie and Clyde' avoided detection

According to the United States Department of Justice, the couple used sophisticated hacking methods and fake identities to launder the funds Lichtenstein stole. They also carried out a complicated web of transactions to avoid getting caught.

The stolen Bitcoins were “layered” and “chain-hopped” through a series of virtual wallets and into AlphaBay, which is a dark net market. It was then channeled back to fake accounts where it was converted into fiat currency, gift cards, gold and even withdrawn as cash from bitcoin ATMs.

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4. A gift card that led authorities to the stolen funds

Ilya Lichtenstein carried out over 2,000 unauthorized transactions to steal 120,000 bitcoins valued at $71 million at the time of theft. For the longest time, authorities were not able to track the stolen funds.

But the couple made one slip-up that allowed them to be traced. They had converted some of the Bitcoins into Walmart gift cards and had redeemed them through Walmart’s iPhone app under an account in Heather Morgan’s name.

This allowed authorities to get a search warrant for the couple's home and cloud storage accounts where they discovered files noting the cryptocurrency addresses used to move the stolen funds and their passwords.

They also found fake identities that the couple had taken up to open accounts at cryptocurrency exchanges.

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5. Ilya Lichtenstein and Heather Morgan admitted to their crimes

Following his arrest and conviction, Lichtenstein was faced with 20 years in prison. But he pleaded guilty in August 2023 to one count of conspiracy to commit money laundering and his sentence has been reduced to five years.

Lichtenstein has expressed remorse for his actions and promised to use his skills and contribute to fighting cyber crimes.

Heather Morgan was described by prosecutors as a “lower-level participant” who only became involved much later. She faces a slightly lenient sentence of 18 months.

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Catch more details about one of the biggest cyber crimes ever on the Netflix documentary Biggest Heist Ever.