Bitfinex Hacker Ilya Lichtenstein Freed Under First Step Act
Ilya Lichtenstein, the perpetrator behind one of the largest Bitcoin thefts on record, has been released from prison a little over a year into a five-year sentence under the First Step Act, a criminal justice reform law enacted during Donald Trump’s first term.
In a post on X on Friday, Lichtenstein said the First Step Act enabled his early release and noted that he intends to contribute positively to cybersecurity as soon as possible.
Passed in 2018, the First Step Act expanded eligibility for sentence reductions through earned time credits and other rehabilitation programs. Lichtenstein was sentenced in November 2024 after pleading guilty to a money laundering conspiracy connected to the 2016 Bitfinex breach, in which nearly 120,000 Bitcoin (BTC) were stolen.
Lichtenstein’s wife, Heather Morgan, also marked the development, sharing a photo of the couple and calling it the “best New Year’s present” after years apart. Morgan, who performed under the name “Razzlekhan” and was charged with helping launder the stolen funds, received an 18-month sentence and announced her own early release in October.
Morgan posts a photo of the couple after Lichtenstein’s release. Source: Heather Morgan
Bitfinex hack defendants arrested in 2022
Lichtenstein and Morgan were arrested in 2022 following a broad federal investigation that led to the seizure of a significant portion of the stolen Bitcoin. Their case later became the subject of a Netflix docuseries, with a feature film in development.
After receiving a five-year sentence, Lichtenstein admitted to hacking Bitfinex in 2016 and laundering thousands of Bitcoin, adding that he aimed to assume full responsibility and that his wife was not involved in the intrusion and did not learn about it for years.
Although many individuals were affected by the Bitfinex hack, an October 2024 court filing indicated the exchange may be the only party eligible for reimbursement. The U.S. government asked victims of the 2016 breach to submit impact statements by November.
Trump to review case of Samourai Wallet co-founder
Lichtenstein’s early release comes as Trump said he would review the case of Samourai Wallet co-founder Keonne Rodriguez, indicating a potential pardon could be considered. At a White House press conference last month, Trump said he was aware of the case and would review it, while noting he was not yet familiar with the details.
In January last year, shortly after taking office, Trump granted Ross Ulbricht, founder of the defunct Silk Road marketplace, a presidential pardon on his life sentence. He also pardoned Binance founder Changpeng “CZ” Zhao in October.
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