Home U.S. government crypto account emptied and then refilled by hackers

U.S. government crypto account emptied and then refilled by hackers

According to cryptocurrency reports, a U.S. government-linked crypto account was hacked and emptied of $20 million, and then a portion of the funds were restored.

Arkham Intelligence, a voice and analyst in the broad spectrum of blockchain analytics, initially reported the news. They were the first to publicly witness the funds being emptied and tracked their movement.

£$20M in USDC, USDT, aUSDC, and ETH has been suspiciously moved from a USG-linked address,” said Arkham in an X post. The hackers subsequently left a calling card in the form of $132 worth of Donald Trump memecoin, MAGA (TRUMP).

Government-linked crypto account compromised

Arkham has now reported that hackers partially refilled the same account. Although not the full amount, those who took part in the breach refilled the account with $19 million.

“The US Government’s address has just received $19.3M back following yesterday’s reported hack, less than 24 hours after the initial address breach. 88% of the compromised USD value has now been recovered,” said the crypto commentators on X:

After the initial swipe of $20 million from the account, an immediate list of transactions began laundering the funds. The currency in the account was linked to a 2016 fraud conviction of a couple named Ilya Lichtenstein and Heather Morgan.

As part of the couple’s cybercrime, the DOJ seized $3.6 billion in cryptocurrency, which was nestled in the account that was hacked and now repopulated with 88% of the funds.

The couple was arrested by U.S. authorities in 2022 and pleaded guilty to hacking and theft of approximately 120,000 bitcoin and money laundering charges.

According the the report, the government seized “approximately 95,000 of those stolen bitcoin from cryptocurrency wallets in the defendants’ control. At the time of the seizure, the recovered funds were valued at approximately $3.6 billion. Since their arrests, the government has seized another approximately $475 million tied to the hack.”

What this hack and the associated transactions mean to the wider cryptocurrency world are unknown, but they deepen the mystery of the pair’s 2016 actions.

Image: Pexels.

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Brian-Damien Morgan
Tech Journalist

Brian-Damien Morgan is an award-winning journalist and features writer. He was lucky enough to work in the print sector for many UK newspapers before embarking on a successful career as a digital broadcaster and specialist. His work has spanned the public and private media sectors of the United Kingdom for almost two decades. Since 2007, Brian has continued to add to a long list of publications and institutions, most notably as Editor of the Glasgow 2014 Commonwealth Games, winning multiple awards for his writing and digital broadcasting efforts. Brian would then go on to be integral to the Legacy 2014,…

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