Bitfinex Hacker Behind $11 Billion Bitcoin Heist Credits Trump for Early Prison Release

Ilya Lichtenstein, the Russian-American convicted for the 2016 Bitfinex hack, was released from prison after serving just 14 months of a five-year sentence. His early release is attributed to the First Step Act, a prison reform law signed by Donald Trump in 2018 according to reports.

Lichtenstein credited the act on X, writing, "Thanks to President Trump's First Step Act, I have been released from prison early." He added that he is committed to making a positive impact in cybersecurity as soon as possible according to reports. The law, intended to reform the federal prison system, includes provisions for early release for certain inmates through earned credits and rehabilitation efforts according to analysis.

Lichtenstein's wife, Heather "Razzlekhan" Morgan, was also released early and similarly thanked Trump for her reduced sentence. She described the reunion as the "best New Year's present" after four years of separation according to reports.

The Bitfinex hack in 2016 led to the theft of 119,754 BTC, valued at $71 million at the time but now worth over $11 billion. U.S. authorities recovered about 94,000 BTC, leaving 25,000 BTC unaccounted for according to reports.

Lichtenstein and Morgan were arrested in February 2022 and pleaded guilty to charges of conspiracy to commit money laundering and defrauding the United States. They were sentenced in 2024, with Morgan receiving 18 months in prison according to reports.

The First Step Act has allowed for the early release of certain inmates by expanding opportunities for earned time credits and rehabilitation. Lichtenstein's release appears to be part of this broader initiative, though the extent of his eligibility remains unclear according to analysis.

A Trump administration official confirmed Lichtenstein's release but did not indicate whether the White House played a role in the decision. The official stated that Lichtenstein had served significant time and was now on home confinement, consistent with federal guidelines according to reports.

The reaction to Lichtenstein's early release has been mixed. While some expressed support, others criticized the decision. An onchain investigator posted a meme suggesting "crime is legal," while others questioned the financial compensation he may have received according to reports.

Why Did This Happen?

The First Step Act, signed into law in 2018, aimed to reduce prison sentences and promote rehabilitation. It allows inmates to earn up to 54 days a year in good time credit, which can lead to early release. Lichtenstein appears to have benefited from these provisions according to reports.

The law also permits elderly and terminally ill inmates to serve their sentences at home. While it is unclear whether Lichtenstein qualified under these categories, the administration official noted that his release was consistent with Bureau of Prisons policies according to reports.

Lichtenstein's early release is part of a broader trend of inmate reductions under the Trump-era reforms. The administration has emphasized reducing overcrowding and saving taxpayer money through these initiatives according to analysis.

How Did Markets React?

The cryptocurrency market has shown signs of recovery in early 2026, with Bitcoin and altcoins experiencing price increases. While Lichtenstein's release may not have directly influenced market trends, the broader context of reduced regulatory uncertainty and improved investor sentiment has contributed to the rally.

Crypto funds have seen $47 billion in inflows in 2025, with altcoins leading the charge. The rise in investor activity and whale accumulation has bolstered market confidence, though the sector remains below 2024 levels.

Analysts are closely monitoring whether the current rally can sustain momentum. With Bitcoin trading above $90,000, the market is optimistic about further gains. However, challenges remain, including regulatory scrutiny and macroeconomic factors.

What Are Analysts Watching Next?

The focus is on how the crypto market responds to regulatory developments and macroeconomic conditions. Analysts are tracking Bitcoin's ability to maintain its price above key resistance levels and the performance of altcoins as a barometer of broader market sentiment.

The recovery of the altcoin market is also being scrutinized. With the Total3 market cap trading above critical support levels, there are expectations for a significant rally. Investors are hopeful for a return to a "Bitcoin season" where altcoins outperform.

Lichtenstein's future actions and any potential contributions to cybersecurity will also be of interest. His public statements suggest a desire to make amends, but the extent of his impact on the industry remains to be seen.

The administration's use of executive power to advance its agenda is another key area of focus. With Trump's approval rating at a low and political tensions rising, the effectiveness of his policies will be under scrutiny in the coming year.