Tech

Ilya Lichtenstein and Heather Morgan

02/08/2022
Bitcoin Ethereum News

The recovery of the stolen BTC from the 2016 Bitfinex hack was the news of the day.  That story’s protagonists, though, they’re legends in the making. You can already tell that Ilya Lichtenstein and Heather Morgan will live forever in meme form. The story is so unlikely that many people in the Bitcoin community are doubtful that it happened as reported. 

Related Reading | Bitcoin Stolen From Bitfinex Hack Moved For The First Time In Five Years

Could this tech entrepreneur and this writer/ rapper have hacked a cryptocurrency exchange? Or are they just the money launderers for a bigger operation? And, did they really save the private keys to billions in BTC on the cloud? Or were they set up? Is law enforcement playing tricks on the public or are they the heroes of the day? 

We can’t answer those questions at the moment. What we can do is explore the Bitfinex hackers’ social media to get a sense of who they are. But first, a summary.

What’s The Bitfinex Hack All About? And, Why Is It Relevant Now?

The “Statement Of Facts” available at the justice.gov website does a good job setting the stage: 

“In or around August 2016, a hacker breached Victim VCE’s security systems and infiltrated its infrastructure. While inside Victim VCE’s network, the hacker was able to initiate over 2,000 unauthorized BTC transactions, in which approximately 119,754 BTC was transferred from Victim VCE’s wallets4 to an outside wallet (Wallet 1CGA4s5 ). At the time of the breach, 119,754 BTC was valued at approximately $71 million. Due to the increase in the value6 of BTC since the breach, the stolen funds are valued at over $4.5 billion as of February 2022.“

That money ended up in a Bitcoin address associated with Ilya Lichtenstein and Heather Morgan, but notice that law enforcement never says they’re the Bitfinex hackers. In fact, the couple has only been charged with money laundering. But, what’s the story here? Our sister site Bitcoinist does a good job thickening the plot: 

“The suspects were arrested in Manhattan, New York. Deputy Attorney General Lisa Monaco called the arrest, one of the largest in terms of financial seizure in history.

In that sense, the government official stated that Bitcoin and cryptocurrencies are not a “safe haven” for criminals. The statement contradicts others made by public officials, such as Senator Elizabeth Warren, which have emphasized the alleged use of crypto in criminal activities. Monaco added:

“In a futile effort to maintain digital anonymity, the defendants laundered stolen funds through a labyrinth of cryptocurrency transactions. Thanks to the meticulous work of law enforcement, the department once again showed how it can and will follow the money, no matter what form it takes.”

Who Is Dutch Ilya Lichtenstein?

Reportedly, Ilya Lichtenstein is a tech entrepreneur and YCombinator alum. In his Twitter, he defines himself as a “Human angel investor, web3 developer, serial entrepreneur.” In his most crucial tweet, Dutch criticizes a New York Magazine article by saying, “Oh god no. So many words about posering on Twitter, almost nothing about how to secure your keys, send a transaction or get a Defi loan.”

Does that seem like the Bitfinex hacker to you? Or, more importantly, does that seem like a person who would store his private keys in the cloud? We wouldn’t know. However, the justice.org report says:

“On January 31, 2022, law enforcement gained access to Wallet 1CGA4s by decrypting a file saved to LICHTENSTEIN’s cloud storage account,8 which had been obtained pursuant to a search warrant. The file contained a list of 2,000 virtual currency addresses, along with corresponding private keys.9 Blockchain analysis confirmed that almost all10 of those addresses were directly linked to the hack.”

In any case, in an article titled “Rethinking the Ethereum Wallet for Mass Adoption,” in the “People are terrified of hackers and malware” section, Ilya Lichtenstein says:

Related Reading | All Altcoin Innovations Will “Ultimately Benefit Bitcoin”: Bitfinex Whale

“The biggest threat to mass adoption is without a doubt, security. It’s still way too hard to properly secure plain text private keys without making a mistake along the way. We cannot expect mainstream users to be security experts in a world where the most common password is still “123456”. Security needs to be built in to the product by design, not left up the user.”

BTCUSD price chart for 02/09/2022 - TradingView

BTC price chart for 02/09/2022 on Oanda | Source: BTC/USD on TradingView.com

Who Is Heather Morgan AKA Razzlekhan?

Reportedly, Heather Morgan is a successful copywriter who grew her own business without outside investors. On her Twitter page, she defines herself as a “Serial entrepreneur. SaaS Investor. Razzlekhan. Surrealist Artist, Rapper & Fashion Designer with synesthesia. Also Forbes writer.” 

Her most crucial tweet says: “Good guiding compass to live by: How much of a POSITIVE IMPACT does your life have on others, including society & nature?”

The reason she’s much more interesting than her husband is her rap alter ego, Razzlekhan. Her videos are not available on YouTube anymore, but you can still listen to the songs on Soundcloud. And, some Twitter users captured clips of the videos before they disappeared:

Below, there’s another track. Above, there’s a sample of the couple’s Tik Tok content:

More interesting yet, though, is Morgan’s career as a Forbes writer. In her article titled “Experts Share Tips To Protect Your Business From Cybercriminals,” the supposed Bitfinex hacker says:

“Companies that didn’t already have distributed teams or work from home policies have struggled to transition to going fully remote amidst the pandemic.

Cybercriminals and fraudsters are taking advantage of this unexpected disruption, leading to a spike in scams and cybercrime.”

Wacky music aside, does that sound like a person who would launder money through gift cards registered to her real name? We wouldn’t know, but the justice.org report says:

“Records showed that portions of the $500 gift card were then redeemed through three transactions for personal items via the Walmart iPhone application. Each of the three redemptions were conducted online under MORGAN’s name, using one of MORGAN’s email addresses, and providing MORGAN and LICHTENSTEIN’s home address for delivery.”

What Does The Twitterati Think About The Alleged Bitfinex Hackers?

Bitcoin investor Alistair Milne questions the couple’s Opsec, “Imagine being a hacker (or money launderer) and keeping the unencrypted private keys to $3.5billion of Bitcoin in an online account linked to your name.” Bitcoin security expert Jameson Lopp questions their choice of location, “Imagine sitting on $4,000,000,000 in stolen bitcoin, knowing you’re being hunted by nation states, and deciding that NYC is a smart place to hole up.”

Featured Image: The alleged Bitfinex hackers from this tweet | Charts by TradingView

Source: https://www.newsbtc.com/news/bitcoin/meet-the-two-alleged-bitfinex-hackers-ilya-lichtenstein-and-heather-morgan/