Originally published on: October 24, 2024
In a recent cyberattack, hackers infiltrated a cryptocurrency wallet believed to be under the control of the US government on October 24. The compromised wallet, which contained funds confiscated from the 2016 Bitfinex hack, was drained of approximately $20 million.
Arkham Intelligence, a leading blockchain analytics firm, revealed that the attacker transferred the stolen funds to a wallet starting with “0x348.” The stolen assets included USD Coin (USDC), Tether (USDT), aUSDC, and Ether (ETH).
The hacker has been actively converting the stablecoins into Ether and funneling the funds through various addresses associated with potential money laundering services. The malicious activity has raised concerns about the security of cryptocurrency holdings, especially those linked to government entities.
The targeted funds were originally seized by the US government following the 2016 Bitfinex hack, orchestrated by Ilya Lichtenstein and Heather Morgan. The couple, who face sentencing in November, were responsible for hacking the Bitfinex exchange and stealing 120,000 Bitcoin valued at approximately $8.2 billion.
Despite initially pleading guilty to money laundering and conspiracy charges, Lichtenstein later confessed to being the mastermind behind the hack. In a plea agreement, US prosecutors recommended leniency for Morgan due to her cooperation with law enforcement.
Prosecutors proposed a five-year prison sentence for Lichtenstein, citing his assistance to investigators and lack of prior criminal history. This reduction marked a significant departure from the 20-year sentence initially sought.
This incident serves as a stark reminder of the vulnerabilities associated with cryptocurrency wallets and the importance of robust security measures in safeguarding digital assets. Stay informed about the latest developments in crypto security by subscribing to our newsletter today.
