Bitfinex could be ‘sole victim’ of 2016 hack, US government says

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As a seasoned crypto investor with a decade of experience under my belt, I must admit that the latest developments regarding the 2016 Bitfinex hack have left me both intrigued and hopeful. The U.S. government’s filing confirms what many in the community have long suspected – Bitfinex, as the primary victim, stands to potentially recover a significant portion of the stolen Bitcoin.

According to a U.S. government document, it appears that only Bitfinex might be entitled to compensation following the large-scale Bitcoin heist in 2016.

The U.S. government’s filing indicates that Bitfinex might be the lone entity entitled to recovery following the infamous 2016 hack, which led to the loss of around 120,000 Bitcoin (BTC), now estimated to be worth a staggering $7.4 billion.

Based on court records, it appears that the U.S. Attorney for the District of Columbia stated that the government does not currently know of anyone who fits the criteria as a victim under the Crime Victims’ Rights Act or eligible for compensation under the Mandatory Victims Restitution Act, apart from possibly Bitfinex.

The main victim of this cyberattack appears to be Bitfinex, with no options for individual users to make claims on the confiscated assets.

Based on what iFinex’s legal team has shared, iFinex feels that they are the only entity experiencing significant financial losses due to the hack, as stated in the document.

The documentation suggests that the recovery process is expected to concentrate exclusively on Bitfinex, a platform that has previously collaborated with law enforcement in an attempt to retrieve the misappropriated funds.

Following this news, the exchange’s LEO (LEO) token jumped over 50% to over $8.

The 2016 Bitfinex hack 

It’s said that the individuals, Ilya Lichtenstein and Heather Morgan, allegedly gained access to Bitfinex’s computer network and carried out more than 2,000 unapproved transactions without authorization.

After the hack, Bitfinex compensated users with BFX tokens, which could be exchanged or converted into shares of its parent company, iFinex. By April 2017, all BFX tokens had been redeemed, showing Bitfinex’s dedication to user compensation and recovery.

In the month of February 2022, American officials confiscated about 94,643 Bitcoin linked to the hack, which was roughly equivalent to $3.6 billion at that moment. Currently, this sum is estimated to be around $5.8 billion and could potentially be returned to Bitfinex.

Ilya Lichtenstein admitted to cleaning $4.5 billion worth of Bitcoin that was stolen in the 2016 Bitfinex heist. Despite initial doubts about the feasibility of such a crime, blockchain transactions traced the funds back to both Bitfinex and Lichtenstein’s digital wallet.

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2024-10-09 20:04