Ilya Lichtenstein, a dual Russian-American national who pleaded guilty to hacking one of the most prominent cryptocurrency exchanges, Bitfinex, has been released early from prison, thanks to a federal prison reform law. Lichtenstein was convicted for one of the largest cryptocurrency thefts recorded to date, having admitted to stealing nearly 120,000 bitcoin from Bitfinex in 2016.
In November 2024, Lichtenstein was sentenced to five years in prison after pleading guilty to conspiracy to commit money laundering related to the cryptocurrency theft. As part of the sentencing, he received credit for time already served since his arrest in 2022, which occurred over five years after the original hacking incident.
His early release was made possible due to the First Step Act, a bipartisan criminal justice reform law signed into law by President Donald Trump in 2018. On Thursday, Lichtenstein announced via his X social media account that he had been released early under this law, which allows eligible federal inmates to earn time credits for good behavior and other factors, facilitating earlier transitions to home confinement.
Following his release, Lichtenstein expressed intentions to pursue a career in cybersecurity and publicly thanked those who supported him during his incarceration. He also stated his desire to demonstrate that his critics were mistaken about his future prospects.
Confirmation of his release came from a Trump administration official who spoke with CNBC on Friday, verifying that Lichtenstein had served a significant part of his sentence and is presently on home confinement. Despite this, official federal inmate locator records as of Friday morning still display a scheduled release date of February 9, indicating that Lichtenstein remains under supervised release conditions.
His wife, Heather Morgan, also involved in laundering the stolen bitcoin and known professionally in the music industry as "Razzlekhan," was sentenced to 18 months in prison and began serving her sentence in February. Morgan similarly benefited from the First Step Act, leading to her early release in October 2024. She characterized Lichtenstein's return home after four years apart as the "best New Year's present," sharing his message on social media.
The First Step Act, which has been applied in both their cases, enables eligible federal inmates to accumulate credits that reduce their prison time by permitting earlier transfers to home confinement. Importantly, this law operates independently of presidential pardons and does not require individual executive intervention.
As a result, both Lichtenstein and Morgan have transitioned to home confinement ahead of their original release dates, marking a significant development in the aftermath of the high-profile Bitfinex cryptocurrency theft case.