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After more than a decade, the U.S. Department of Justice (DOJ) has identified and charged the hackers responsible for stealing hundreds of thousands of Bitcoin from the defunct cryptocurrency exchange Mt. Gox.
The primary suspects identified are Russian nationals Alexey Bilyuchenko, 43, and Aleksandr Verner, 29.
Mt. Gox Hackers Identified
In a press release issued on Friday, the DOJ stated that both Bilyuchenko and Verner are charged with “conspiring to launder approximately 647,000 bitcoins from their hack of Mt. Gox.”
Although Mt. Gox officially suspended trading in February 2014, the hack is believed to have begun around September 2011. At that time, co-conspirators “gained unauthorized access” to the Japanese computer system holding the private keys that controlled customers’ Bitcoin.
The hackers continued to steal coins until May 2014, after which the exchange had already abandoned plans to rebuild. The bulk of the stolen assets were funneled through Bitcoin addresses connected to accounts controlled by Bilyuchenko, Verner, and their co-conspirators at other cryptocurrency exchanges.
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“IRS Criminal Investigation (IRS-CI) is specially equipped to follow the complex financial trail left by criminals, and we are dedicated to holding those accountable for crimes committed,” said IRS-CI Chief Jim Lee in a statement.
Before its collapse, Mt. Gox was one of the most dominant Bitcoin exchanges in history, controlling 70% of Bitcoin trading volume by 2014. Its hack remains the largest exchange hack of all time in BTC-denominated terms, with the lost 744,408 coins currently valued at over $19 billion.
The Mt. Gox bankruptcy process is only concluding this year, with the exchange’s largest creditor opting to receive 90% of its owed assets in Bitcoin in February.
Beyond Mt. Gox
Following the massive Mt. Gox theft, Bilyuchenko also conspired with Alexander Vinnik to operate BTC-e from 2011 to 2017—a cryptocurrency exchange funded using “ill-gotten gains from Mt. Gox.”
According to the DOJ, BTC-e processed billions of dollars in transactions, much of which originated from “hacking incidents, ransomware events, identity theft schemes, corrupt public officials, and narcotics distribution rings.”
Bilyuchenko has been charged with money laundering conspiracy for his crimes at Mt. Gox, as well as with money laundering conspiracy and operating an unlicensed money services business at BTC-e.
