US Government Transfers Nearly $1 Billion in Bitcoin Linked to 2016 Bitfinex Hack

Late Wednesday, the US government made significant transfers totaling close to $1 billion in Bitcoin from two wallets associated with the 2016 Bitfinex hack, according to data from Arkham Intelligence.

The transfers unfolded in a series of transactions. Initially, one wallet sent out 1 Bitcoin, followed by a subsequent transfer of 2,817 Bitcoin. Shortly after, a second wallet transferred 0.01 Bitcoin, succeeded by another transfer of 12,267 Bitcoin.

These combined transfers amounted to approximately $923 million, as recorded by Arkham’s outflows.

The reasons behind the government wallets’ transfers remain unclear. However, the timing coincides with heightened activity in the cryptocurrency market, particularly propelling Bitcoin above the $60,000 mark on Wednesday.

The surge comes amidst anticipation surrounding Bitcoin price forecasts, notably with the impending halving event expected to have a significant impact on market dynamics.

Read Also: Bitfinex’s CTO Paolo Ardoino Backs RGB Protocol for Bitcoin Stablecoins

The US government and Bitfinex Notorious Heist

The US government has amassed around 200,000 Bitcoins through seizures linked to criminal activities, valued at roughly $5 billion, establishing it as one of the largest holders of Bitcoin.

Additionally, a significant portion of the seized Bitcoin stems from the 2016 Bitfinex hack. Ilya “Dutch” Lichtenstein and his wife Heather Rhiannon Morgan, the individuals behind the hack, were arrested in 2022. Subsequently, the Justice Department announced its most substantial financial seizure to date, totaling about 95,000 Bitcoins.

The couple allegedly employed false identities to establish online accounts and obfuscated the transaction trail by moving funds through multiple platforms, including crypto exchanges and darknet markets.

Furthermore, Lichtenstein confessed to purchasing mushrooms and LSD from darknet markets, clarifying that he remained drug-free while carrying out the hacks.

Arkham Intelligence also revealed the existence of another US government wallet containing about 94,600 BTC of seized Bitfinex hacker funds, worth roughly $5.79 billion at the current price.