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Man Who Laundered Billions in Bitcoins Says Bitcoin Fog Was a Help: Bloomberg
Ilya Lichtenstein, who pleaded guilty in the Bitfinex case last year, is now a U.S. witness who testified about his use of Bitcoin Fog and other mixers to hide loot.
- Ilya Lichtenstein has gone from high-profile defendant to government witness, testifying against a mixing service that he used to hide laundered assets from the Bitfinex hack.
- He told a jury that Bitcoin Fog – a darknet favorite – wasn't as good as some of the other mixers he used.
Ilya Lichtenstein, one of the crypto industry's most high-stakes criminals, is now helping federal prosecutors in their case against Bitcoin Fog, one of the mixing services he said he'd used to conceal assets.
Lichtenstein – known for the multi-billion Bitfinex hack of bitcoins worth $3.6 billion when he pleaded guilty to money laundering last year – appeared this week in a Washington, D.C., trial of the accused operator of the mixing service associated with darkweb criminality, according to a report from Bloomberg News.
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Lichtenstein, who had been charged and pleaded guilty alongside his wife, Heather “Razzlekhan” Morgan, told the jury that he used various mixers including Bitcoin Fog to "obfuscate" the funds from the Bitfinex hack, but it wasn't his major method of laundering, according to Bloomberg. He said he moved on from that particular mixer once he discovered other services "suited his purposes better."
The U.S. Department of Justice's seizure of the billions in crypto in the Bitfinex case was unprecedented.
In the Bitcoin Fog case, U.S. authorities had arrested and charged Roman Sterlingov, a dual Russian-Swedish national, with money laundering in his operation of the mixing service in 2021. He's now on trial in that case.
Jesse Hamilton
Jesse Hamilton is CoinDesk's deputy managing editor on the Global Policy and Regulation team, based in Washington, D.C. Before joining CoinDesk in 2022, he worked for more than a decade covering Wall Street regulation at Bloomberg News and Businessweek, writing about the early whisperings among federal agencies trying to decide what to do about crypto. He’s won several national honors in his reporting career, including from his time as a war correspondent in Iraq and as a police reporter for newspapers. Jesse is a graduate of Western Washington University, where he studied journalism and history. He has no crypto holdings.
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Crypto Industry Asks President Trump to Stop JPMorgan’s 'Punitive Tax' on Data Access
A coalition of fintech and crypto trade groups is urging the White House to defend open banking and stop JPMorgan from charging fees to access customer data.
What to know:
- Ten major fintech and crypto trade associations have urged President Trump to stop big banks from imposing fees that could hinder innovation and competition.
- JPMorgan's plan to charge for access to consumer banking data may debank millions and threaten the adoption of stablecoins and self-custody wallets.
- The CFPB's open banking rule, which mandates free consumer access to bank data, is under threat as banks have sued to block it, and the CFPB has requested its vacatur.
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