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Bitfinex money launderer ‘Razzlekhan’ sentenced to 18 months in prison

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Heather Morgan, also known by her online persona “Razzlekhan,” has been sentenced to prison for her involvement in a large-scale money laundering operation linked to the Bitfinex exchange hack. Morgan, along with her husband Ilya Lichtenstein, was convicted for conspiring to launder over $4.5 billion worth of cryptocurrency stolen in a 2016 hack of the popular crypto exchange. Morgan received a sentence of more than two years in federal prison after being found guilty of facilitating the laundering of stolen funds, much of which was transferred across various digital wallets in an attempt to obscure the illicit activity.

The hack, one of the largest in cryptocurrency history, saw nearly 120,000 Bitcoin stolen from Bitfinex users, an amount that at the time was worth roughly $72 million but has since ballooned in value. Morgan and Lichtenstein were arrested in early 2022, and U.S. authorities managed to trace and seize a significant portion of the stolen funds, ultimately recovering over $3.6 billion in Bitcoin. Their arrests were part of a broader crackdown on cryptocurrency-related crimes, signaling the increasing efforts by law enforcement to track and combat digital asset-based money laundering.

Morgan, a self-proclaimed “serial entrepreneur” and “cybersecurity expert,” gained public attention due to her eccentric online persona and social media presence. Her involvement in the laundering scheme began when she and Lichtenstein devised a sophisticated plan to move the stolen Bitcoin through a series of transactions, using fake identities and sophisticated technology to mask their activities. However, the pair’s attempts to cover their tracks ultimately failed as investigators employed blockchain analysis tools to trace the illicit funds.

The sentencing marks a significant development in the ongoing battle against cryptocurrency-related crime, highlighting both the potential for large-scale illicit activities in the digital asset space and the growing effectiveness of authorities in prosecuting such crimes. While Morgan’s sentence is a notable outcome, the legal proceedings against Lichtenstein are still ongoing. The case serves as a reminder of the risks and legal consequences associated with illegal activities in the cryptocurrency market, and it could set a precedent for future enforcement actions targeting money laundering in the sector.

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SEC and Gemini ask to pause lawsuit to explore ‘potential resolution’

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The U.S. Securities and Exchange Commission (SEC) and crypto exchange Gemini have agreed to pause legal proceedings as both sides explore a potential resolution to their ongoing lawsuit. The move signals a possible settlement in the high-profile case, which centers around Gemini’s now-defunct Earn program.

The SEC initially sued Gemini, alleging that the Earn program—designed to offer users yield on crypto deposits—operated as an unregistered securities offering. Gemini has pushed back against the claims, arguing that its operations complied with regulatory standards.

By pausing litigation, both parties may be looking for a compromise that could set a precedent for crypto lending products in the U.S. A settlement could also provide regulatory clarity for similar platforms navigating SEC scrutiny.

While the outcome remains uncertain, the crypto industry is closely watching the case, as its resolution could impact future enforcement actions and the broader regulatory approach toward digital asset lending services.

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GameStop finishes $1.5B raise to add Bitcoin to its balance sheet

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GameStop has successfully completed a debt offering, raising capital that may be used to acquire Bitcoin, signaling the company’s deeper foray into digital assets. The move aligns with its broader strategy to diversify beyond traditional retail operations and into emerging financial technologies.

While GameStop has not confirmed the exact allocation of the funds, market speculation suggests that a portion could be used to buy Bitcoin, following in the footsteps of companies like MicroStrategy. The potential investment would reinforce GameStop’s ongoing pivot toward blockchain and digital assets, an effort that began with its NFT marketplace and crypto-related initiatives.

Analysts see this development as part of a growing trend of corporations exploring Bitcoin as a reserve asset amid concerns over inflation and monetary policy. If GameStop proceeds with the acquisition, it could further validate Bitcoin’s role as a strategic investment for publicly traded companies.

The company’s board will ultimately decide how the newly raised capital is deployed. Investors and the broader crypto market are watching closely for any official announcements regarding GameStop’s Bitcoin strategy.

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North Korea tech workers found among staff at UK blockchain projects

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North Korean cyber threats posed by state-backed tech workers are expanding beyond the United States, with major companies worldwide now in their crosshairs. Security experts warn that these operatives are infiltrating international firms, using their positions to facilitate cyber espionage, launder illicit funds, and aid North Korea’s sanctioned economy.

Previously, U.S. authorities had sounded alarms over North Korean IT workers securing remote jobs at American tech companies under false identities. Now, reports indicate that their activities have extended to companies in Europe, Asia, and other regions, raising concerns about the global cybersecurity landscape.

Google’s Threat Analysis Group (TAG) has been tracking these activities, noting that North Korean-linked actors often leverage freelance job platforms to gain access to sensitive corporate networks. Once inside, they exploit security vulnerabilities, steal intellectual property, and funnel earnings to fund the country’s sanctioned weapons programs.

Governments and private sector firms are now stepping up efforts to identify and block these infiltrations. Experts urge companies to strengthen hiring practices, conduct rigorous background checks, and implement stricter cybersecurity measures to prevent North Korean operatives from exploiting remote work opportunities.

As geopolitical tensions rise, the increasing reach of North Korean cyber operations highlights the urgent need for enhanced global coordination to counter these threats and protect critical industries from digital infiltration.

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