Bitfinex Named Sole Victim for 2016 Hack Restitution

In a District Court filing, the US government called Bitfinex the “sole victim” eligible for restitution after the famous 2016 hack. Defrauded Bitfinex users are encouraged to file claims with the exchange.

The government has recovered billions of dollars from this hack. However, due to a surge of private claimants, these funds have yet to be allotted.

Bitfinex’s Hack Fallout

The US Government claimed today that Bitfinex exchange is the “sole victim” eligible for restitution, according to the Crime Victim’s Rights Act (CVRA) and Mandatory Victim Restitution Act (MVRA). This claim was made in a filing from the US District Court of Washington, DC.

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“The government is not aware of any person who qualifies as a victim under the CVRA or for restitution under the MVRA, beyond perhaps Bitfinex… but seeks such relief out of an abundance of caution, in order to provide notice to members of the public—in particular, to former account holders… and to give them an opportunity to advance potential claims,” it stated.

In other words, the federal government singled Bitfinex out as the primary conduit for former exchange users to get their funds back. In 2022, the Department of Justice seized over $3.6 billion of stolen assets, and a huge number of claimants came forward. Hence, sorting through legitimate and fraudulent claims became a particular challenge for law enforcement.

Bitfinex, for its part, has been closely cooperating with the authorities to get their customers’ money back. In 2023, the firm announced that the government returned over $312,000 in cash and Bitcoin Cash (BCH) but no other assets. Its 2023 restitution plan involved making payouts to Bitfinex’s LEO token owners, and LEO spiked 40% since today’s filing.

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The filing was very explicit about the intended path for defrauded users to get their money back. The government will only make recovery payouts to Bitfinex, so all private claims should go through this exchange.