Over the last five years, about 25,000 of those Bitcoin were transferred out of Mr. Lichtenstein’s wallet using a complicated series of transactions meant to obscure that the currency had been stolen from Bitfinex, the Justice Department said.
But investigators traced the movement of the Bitcoin on the blockchain, the permanent fixed electronic ledger that records each time a Bitcoin moves to a new digital wallet. And some of those funds were eventually deposited into financial accounts controlled by Mr. Lichtenstein and Ms. Morgan, according to the department.
Law enforcement officials gained access to Mr. Lichtenstein’s wallet on Jan. 31, after they obtained a search warrant that gave them entry to encrypted files in Mr. Lichtenstein’s cloud storage account.
A Guide to Cryptocurrency
Card 1 of 7A glossary. Cryptocurrencies have gone from a curiosity to a viable investment, making them almost impossible to ignore. If you are struggling with the terminology, let us help:
Bitcoin. A Bitcoin is a digital token that can be sent electronically from one user to another, anywhere in the world. Bitcoin is also the name of the payment network on which this form of digital currency is stored and moved.
Blockchain. A blockchain is a database maintained communally, that reliably stores digital information. The original blockchain was the database on which all Bitcoin transactions were stored, but non-currency-based companies and governments are also trying to use blockchain technology to store their data.
Cryptocurrencies. Since Bitcoin was first conceived in 2008, thousands of other virtual currencies, known as cryptocurrencies, have been developed. Among them are Ether, Dogecoin and Tether.
Coinbase. The first major cryptocurrency company to list its shares on a U.S. stock exchange, Coinbase is a platform that allows people and companies to buy and sell various digital currencies, including Bitcoin, for a transaction fee.
Crypto finance. The development of cryptocurrencies spawned a parallel universe of alternative financial services, known as Decentralized Finance, or DeFi, allowing crypto businesses to move into traditional banking territory, including lending and borrowing.
NFTs. A “nonfungible token,” or NFT, is an asset verified using blockchain technology, in which a network of computers records transactions and gives buyers proof of authenticity and ownership. NFTs make digital artworks unique, and therefore sellable.
The next day, investigators seized the 94,636 Bitcoin that remained in that wallet, which were worth more than $3.6 billion, according to court papers. The stolen Bitcoin, worth about $71 million when Bitfinex was hacked in 2016, are now worth more than $4.5 billion, according to the Justice Department.
The arrest shows that “we will not allow cryptocurrency to be a safe haven for money laundering or a zone of lawlessness within our financial system,” Kenneth A. Polite Jr., the head of the Justice Department’s criminal division, said in a statement.
With more Americans buying and selling cryptocurrencies like Bitcoin, regulators have brought some large exchanges in the United States under official oversight.