Bitfinex Hacker Thanks Trump’s First Step Act for Early Prison Release

Ilya Lichtenstein, convicted of laundering nearly 120,000 Bitcoin stolen from cryptocurrency exchange Bitfinex in 2016, has been released from federal prison early. He credited President Donald Trump’s First Step Act for his shortened sentence.

Lichtenstein announced his release on X on Friday, thanking the criminal justice reform legislation that Trump signed into law in 2018. The act allows inmates to earn early release through rehabilitation programs and productive activities during incarceration.

Thanks to President Trump's First Step Act, I have been released from prison early.
I remain committed to making a positive impact in cybersecurity as soon as I can.

To the supporters, thank you for everything.
To the haters, I look forward to proving you wrong.

— Ilya Lichtenstein (@cipherstein) January 2, 2026

U.S. authorities arrested Lichtenstein and his wife Heather Morgan in February 2022. Prosecutors charged the pair with attempting to launder the massive Bitcoin haul, valued at approximately $4.5 billion at the time of their arrest.

Last November, Lichtenstein received a five-year prison sentence after pleading guilty to his role in the historic cryptocurrency heist. Morgan, who assisted in the laundering operation, was sentenced to 18 months in prison.

Morgan Released Under Trump-Era Law

Heather Morgan secured her release in October after serving roughly eight months of her 18-month sentence. Her early departure from custody preceded her husband’s release by several months.

In her first video posted to X since her early release from prison, Morgan appears in an 18-second clip filmed from a bathtub, where she tells her followers, whom she calls her “Razzlers” that she missed them and that it feels “very good to be back.”

The couple’s case became one of the most closely watched cryptocurrency prosecutions in U.S. history. The 2016 Bitfinex hack remains among the largest cryptocurrency thefts ever recorded.

Following their arrest, federal agents seized the stolen Bitcoin along with other assets. The recovery represented one of the largest cryptocurrency seizures in Department of Justice history.

Lichtenstein’s early release continues a pattern of Trump administration clemency toward crypto-related convictions. The president has used his pardon power extensively to reshape federal cryptocurrency enforcement.

Trump’s Crypto Pardons Reshape Federal Enforcement

In January 2025, Trump granted clemency to Silk Road founder Ross Ulbricht. Ulbricht had served more than a decade of a sentence that included two life terms for running the dark-web marketplace.

The Ulbricht pardon fulfilled a campaign promise to libertarian voters and Bitcoin supporters. Months later, Ulbricht addressed the Bitcoin 2025 conference as a free man.

Donald Trump has officially pardoned Ross Ulbricht, the founder of online black market ‘Silk Road’, from his life prison sentence pic.twitter.com/iiz2P6HSSz

— Dexerto (@Dexerto) January 22, 2025

In March, Trump extended pardons to BitMEX co-founders Arthur Hayes, Benjamin Delo, and Samuel Reed. Early employee Greg Dwyer also received clemency.

All four had pleaded guilty in 2022 to Bank Secrecy Act violations. They failed to implement required anti-money-laundering controls at the cryptocurrency derivatives exchange.

Each defendant had received probation and financial penalties before the pardons cleared their felony records. Hayes thanked the president on X following the announcement.

Thank you @POTUS

— Arthur Hayes (@CryptoHayes) March 28, 2025

BitMEX described the guilty pleas as “old news” at the time. The company attempted to distance itself from the enforcement action that targeted its founding team.

The president called previous government enforcement actions “ridiculous.” His statements positioned cryptocurrency regulation as a national political battleground.

These moves signaled a dramatic shift in Washington’s approach to digital asset oversight. Questions remain about how federal agencies will police cryptocurrency markets during Trump’s second term.

The pardons and early releases have cleared several of the industry’s most high-profile defendants. Supporters view the decisions as necessary course corrections in an overreaching regulatory environment.

Critics argue that the clemency grants undermine years of enforcement efforts. They warn that the decisions may embolden future violations of anti-money-laundering requirements.

Lichtenstein’s release adds another chapter to this ongoing transformation of federal cryptocurrency policy. His case involved one of the largest thefts in crypto history.