Unveiling the Truth: Did Razzlekhan’s Husband Really Hack Bitfinex?

We appear to have stumbled upon a solution to one of the crypto world's longstanding enigmas. Yesterday, Ilya Lichtenstein, the spouse of the infamous rapper Razzlekhan (also known as Heather Morgan), made a shocking admission regarding the 2016 cyber theft of 120,000 bitcoins from the offshore crypto exchange Bitfinex. However, the circumstances surrounding this confession are undeniably peculiar, and even one of America's most renowned reformed hackers finds it hard to believe.

“Ilya is a f***ing idiot,” argues Brett Johnson. “If you look at the way he was trying to launder money, he was doing absolutely everything wrong.”

Johnson, the founder and leader of Shadow Crew, a notorious cybercrime cartel in the early 2000s, should be well aware of the subject. Following his arrest in 2005, he transformed into a confidential informant for the Secret Service. Despite encountering some setbacks, he has since earned significant respect as a white hat cybersecurity expert.

In addition to doubts about Lichtenstein's proficiency, the details surrounding the confession remain obscure. The U.S. Department of Justice opted not to accuse Morgan and Lichtenstein, who Morgan occasionally affectionately called "Dutchie," of directly conducting the hack. Instead, they were charged solely with attempted money laundering of the stolen funds.

It remains uncertain from the reporting yesterday whether Lichtenstein's plea deal on the money laundering charges required a confession to the hack, which would be highly uncommon. The approximately 120,000 BTC that were hacked from Bitfinex had an initial value of around $70 million in 2016, but astonishingly surged to $4.3 billion by the time of the couple's arrest last year.

Following the arrests of Lichtenstein and Morgan, numerous lingering uncertainties surrounded the identity of the primary perpetrator behind the initial hack. One conjecture suggested that Lichtenstein and Morgan might have obtained discounted access to the stolen bitcoins by purchasing keys from the original hacker, or they could have been acting as intermediaries, handling and laundering the funds on behalf of a third party. However, these speculations lacked substantial credibility, and a prevailing belief persisted that the couple was both responsible for the hack and the attempted money laundering.

Brett Johnson remains doubtful, given Lichtenstein's apparent carelessness in executing the money laundering aspect of the heist.

“He was doing chain hopping … But the cashout was always coming out to his name. In Shadow Crew, we said, all cybercrime should start with identity theft,” Johnson told me. “[Lichtenstein] even had some Coinbase accounts that were directly connected to him. It simply did not make sense at all that he was doing it like that.”

Lichtenstein also funneled a portion of the stolen funds through the darknet market Alphabay. However, according to Johnson's assertion, “If he had any experience at all, he knew that market was going to get shut down by law enforcement, or do an exit scam. So it doesn’t make sense to me.”

“What it really reads like is, in theory the guy knows how to launder money, but in practice he had never done it at all,” he added

An even more glaring indication of the duo's questionable competence: Lichtenstein seemingly stored the private keys to billions of dollars' worth of bitcoin on a cloud drive, potentially exposing it to seizure by law enforcement.

More surprisingly, the post-2016 actions of Razzlekhan and Dutchie, both prominent hackers, diverged from the expected norm. Instead of vanishing to some remote country without extradition treaties, they made an unexpected move to Wall Street. In contrast, Lichtenstein preferred to keep a low profile. However, it was Heather Morgan's behavior that truly stood out, especially considering her alleged possession of millions of stolen bitcoins. Despite this, she presented herself as the head of an email marketing company, contributed articles to Forbes, and even gave public talks on hacking. To add to the enigma, she delved into a seemingly unrelated and perhaps theft-subsidized career as a peculiar rapper, adopting the alias "Razzlekhan."

That could merely suggest that the couple recklessly made decisions after committing a significant crime. However, Brett Johnson believes there is a far more intricate narrative behind it.

“It doesn’t ring very true to me at all.”