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Feds arrest couple, seize $3.6B in hacked Bitcoin funds

washingtonpost.com

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Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#181

Post by gk1 »

rasz wrote: post #7

"Today Ilya Lichtenstein is the co-founder of the Y Combinator backed Mix Rank," One of the first Google results for the names returns 'Get your first $1 million in enterprise sales with zero marketing spend' https://www.youtube.com/watch?v=DuIr5IFQ9Xg Heather R Morgan Serial entrepreneur SaaS Investor Razzlekhan = Surrealist Artist, Rapper & Fashion Designer with synesthesia Also Forbes writer https://www.inc.com/he…

I met Heather many years ago. It's a weird feeling to see a name you recognize in an announcement like this. We've lost touch long since so I have no comment.

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#182

Post by AlexanderTheGr8 »

A4ET8a8uTh0 wrote: post #112
AlexanderTheGr8 wrote: post #64

> “After the execution of court-authorized search warrants of online accounts controlled by Lichtenstein and Morgan, special agents obtained access to files within an online account controlled by Lichtenstein,” the press release said. “Those files contained the private keys required to access the digital wallet that directly received the funds stolen from Bitfinex, and allowed special agents to lawfully seize and rec…

While I do partially agree that some of it may be grandstanding. The whole: "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.” and suggesting AEC and chain hopping is futile is an effective propaganda tool. I mean its possible something major changed, but I think your thoughts are closer to reality. If true, this is…

I agree. Propaganda is very effective here. And it's actually good - it deters potential criminals.

But if someone who knew how crypto works wanted to commit a crime, they can. That's scary.

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#183

Post by aksss »

paulpauper wrote: post #155
not2b wrote: post #128

Earlier quoted context omitted.

The (alleged) criminal only has to make one mistake to get caught, if the pursuers are good. Steal enough money and the best pursuers will be assigned to catch the perp.

John Ruffo who stole $300 million still at large after 20 years

https://en.m.wikipedia.org/wiki/John_Ruffo

$25,000 bounty seems pretty small, considering.

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#184

Post by Gasp0de »

14 wrote: post #34
raverbashing wrote: post #8

Earlier quoted context omitted.

A fancy (or even basic) dictionary attack has a very high chance of working.

Random example but my passwords look something like chOf$Tyl83fhn@54R. I keep them written down because they are hard to remember. My threat model is no one. Seems so amateur to use a simple password that could be brute forced. Especially with so much on the line.

https://www.useapassphrase.com/

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#185

Post by AlexanderTheGr8 »

aksss wrote: post #172
AlexanderTheGr8 wrote: post #130

Earlier quoted context omitted.

They don't usually give details of how they caught them, because the next bad-actor will read that to know their tactics. Search warrants are given on reasonable doubt . When it comes to cryptocurrencies, the feds have reasonable doubt on everyone. So it is always possible for them to get a search warrant. I emphasized private keys, bec without them, no matter how much doubt the feds had, they couldn't prove anything…

> reasonable doubt I think you mean reasonable suspicion & probable cause. Reasonable doubt is the threshold prosecutors must appear to exceed for a successful finding of guilt with a jury (elimination of reasonable doubt).

You are right. I meant "reasonable suspicion & probable cause". My bad. Got confused between the 2.

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#186

Post by tiffanyh »

albroland wrote: post #6

fwiw, it appears one of the named here is a YC Alum: https://news.ycombinator.com/user?id=il https://www.linkedin.com/in/unrealdutch/

Let's be fair to these individuals and not presume guilt.

In the US, it's "innocent until proven guilty".

Media is so quick to assume the person is guilty just because of an allegation.

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#187

Post by openhandcrimp »

vmception wrote: post #141
knownjorbist wrote: post #89

Earlier quoted context omitted.

Another possibility is Ironfish( https://ironfish.network/ ), but I don't know how much liquidity there exists in either of these. I don't think you could launder/hide $4bn through either of these. Perhaps slowly over a long period of time.

Ironfish is just a testnet so there is zero liquidity there because it isn't even launched. Tornado cash has about $700mm right now deposited in it, with the vast majority of that being in the 100 ETH deposit pool. They absolutely could have done it over time. They could have bridged the Bitcoin using the RenVM protocol to receive renBTC, done a combination of selling the renBTC and let arbitrageurs provide the liqui…

An excellent overview of how the crypto ecosystem glues together. Also a shame that understanding and explaining how these technologies can be (and probably are!) used together leads to accusations of criminal past or intentions.

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#188

Post by bastawhiz »

lern_too_spel wrote: post #150
deepsun wrote: post #132

Should I expect price drop once feds start to sell it? Or they'll just destroy the keys (keeping the money invested forever).

It will probably be returned to Bitfinex if they can access the wallet.

That's assuming the feds don't have unfinished business with Bitfinex. They're not exactly on great terms.

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#189

Post by AlexanderTheGr8 »

paulpauper wrote: post #144
nerdwaller wrote: post #133

Earlier quoted context omitted.

The file the feds found had 2,000 addresses - so there's a non-trivial amount of 12 word phrases to remember.

you would only need to memorize one seed to spawn infinite key pairs

can you elaborate? I find this very interesting. We can't choose which private key we get.

So is it possible for 1 seed to generate all of them? Doesn't that break information theory (Shannon's compression limit)?

Re: Feds arrest couple, seize $3.6B in hacked Bitcoin funds

#190

Post by MauranKilom »

AlexanderTheGr8 wrote: post #96
loceng wrote: post #14

I ask this every so often during threads regarding stolen cryptocurrency: Is there any solution yet to preventing stolen cryptocurrency funds from being spent? Isn't the only solution to have a central database and require laws to require every transaction to be pre-checked to see if it's stolen funds or not? And not only that, the centralized system will have to be constantly keeping track of wallet mixing to see wh…

what do you think about tornado.cash? It's apparently a very effective mixer. I wonder what law enforcement can do if someone ends up using tornado_cash. There is absolutely no way of knowing if the money is good or bad. If you consider every mixed_cash as bad, you would be forced to assume that the entire cryptocurrency is bad bec of how the money flows.

> If you consider every mixed_cash as bad, you would be forced to assume that the entire cryptocurrency is bad bec of how the money flows.

That's exactly what's happening, according to this page that was on the HN front page a few days ago: https://news.ycombinator.com/item?id=30224637

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