US married couple arrested for allegedly conspiring to launder $4.5bn in bitcoin

The US justice department has announced the unraveling of its biggest-ever cryptocurrency theft case, seizing a record-shattering $3.6bn in bitcoin in a saga that has captivated the internet.

US officials said on Tuesday the recovered sum was linked to the hack of Bitfinex, a virtual currency exchange whose systems were breached by hackers nearly six years ago.

They face charges of conspiring to commit money laundering as well as to defraud the United States. The case was filed in a federal court in Washington DC.

Lichtenstein, who maintains a lower profile online, described himself on Linkedin as an angel investor. He is an alumnus of the prestigious Y-combinator, a company that has helped to launch an array of prominent tech startups.

At an initial court appearance, a magistrate judge ruled Lichtenstein could be released into home detention on a $5m bond co-signed by his parents; the bond amount for Morgan was set at $3m. They were to remain in custody until the bail conditions were met.

A key clue in the investigation may have come from the 2017 bust of an underground digital market used to launder a portion of the funds. US officials said some of the money was transferred to AlphaBay, an anything-goes version of eBay hosted on the dark web.

Cyber criminals who attack companies, municipalities and individuals with ransomware often demand payment in cryptocurrency.

In one high-profile example last year, former partners and associates of the ransomware group REvil caused a widespread gas shortage on the US east coast when it used encryption software called DarkSide to launch a cyber attack on the Colonial Pipeline.

The justice department later recovered some $2.3m in cryptocurrency ransom that Colonial paid to the hackers.