Ilya Lichtenstein and Heather Morgan, the couple known online as Razzlekhan, both pleaded guilty to laundering Bitcoin stolen from the Bitfinex exchange and were sentenced in November 2024. Lichtenstein received five years in federal prison; Morgan received 18 months. Both were later moved to home confinement, and the roughly 94,643 Bitcoin investigators recovered from them was ordered returned to Bitfinex as restitution.
The Charges They Pleaded To
Lichtenstein and Morgan were each charged with conspiracy to commit money laundering under 18 U.S.C. § 1956 and conspiracy to defraud the United States under 18 U.S.C. § 371.1United States Department of Justice. United States v. Ilya Lichtenstein and Heather Morgan The money laundering count carries a statutory maximum of 20 years.2Office of the Law Revision Counsel. 18 US Code 1956 – Laundering of Monetary Instruments The conspiracy count carries a maximum of five.3Office of the Law Revision Counsel. 18 US Code 371 – Conspiracy to Commit Offense or to Defraud United States
They were arrested in February 2022. On August 3, 2023, both entered guilty pleas rather than go to trial. Lichtenstein pleaded guilty to one count of conspiracy to commit money laundering and admitted, as part of that plea, that he was the person who hacked Bitfinex in August 2016 and stole approximately 120,000 Bitcoin.4U.S. Immigration and Customs Enforcement. Bitfinex Hacker Sentenced in Money Laundering Conspiracy Involving Billions in Stolen Cryptocurrency Morgan pleaded guilty to the same money laundering count plus one count of conspiracy to defraud the United States.
Both plea agreements required cooperation with federal investigators and the forfeiture of all seized property.
The Sentences
Lichtenstein was sentenced on November 14, 2024, to five years in federal prison.5United States Department of Justice. Bitfinex Hacker Sentenced in Money Laundering Conspiracy Involving Billions in Stolen Cryptocurrency Morgan was sentenced four days later, on November 18, 2024, to 18 months.
Both sentences fell well below what the federal sentencing guidelines suggested. For Lichtenstein, the calculated range was 121 to 151 months. Prosecutors asked the court to depart downward and recommended 60 months, citing his cooperation with investigators in his own case and in other ongoing investigations. The judge sentenced him at that recommended figure.
Morgan’s shorter sentence reflected both her lesser role in the underlying hack and her own cooperation. According to the government, Lichtenstein carried out the 2016 breach and directed the laundering scheme, while Morgan’s involvement centered on helping move and conceal the proceeds.
Where They Are Now
Neither defendant served the full sentence in a federal prison facility.
Lichtenstein received credit for time served in custody following his 2022 arrest and was later moved to home confinement under Bureau of Prisons policies. As of early January 2026, federal records showed a release date of February 9, 2026.
Morgan entered prison in February 2025 and was released early, before the end of her 18-month term. She posted a video announcing her release. The Bureau of Prisons has discretion under existing federal law to move inmates to home confinement for the final portion of their sentences, and early transfers of this kind are not unusual in federal cases involving short sentences, cooperation credit, and good behavior.
What Happened to the Stolen Bitcoin
The 2016 hack netted roughly 120,000 Bitcoin, spread across more than 2,000 wallet addresses under Lichtenstein’s control.6United States Department of Justice. 2016 Bitfinex Hack Investigators from IRS Criminal Investigation, the FBI, and Homeland Security Investigations traced the funds on the blockchain, obtained court-authorized seizure warrants, and gained access to the private keys for the wallet holding most of the coins. They recovered 94,643 BTC, worth about $3.6 billion at the time of seizure and the largest financial seizure in Department of Justice history.
Under the couple’s plea agreements, the recovered Bitcoin was forfeited to the government.7Legal Information Institute. Federal Rules of Criminal Procedure Rule 32.2 – Criminal Forfeiture In early 2026, a federal court ordered the 94,643 BTC returned to Bitfinex as in-kind restitution, along with associated forked coins including Bitcoin Cash, Bitcoin SV, and Bitcoin Gold. Because the returned assets were the actual cryptocurrency rather than a cash equivalent, and because Bitcoin had appreciated sharply since 2016, the coins were worth roughly $10 billion at the time of the order.
About 25,000 Bitcoin from the original theft remain unrecovered. Those coins were moved or spent during the years between the hack and the arrests, and no public information indicates that investigators have identified a path to recovering them.