Alleged Bitcoin launderer Heather Morgan, aka Razzlekhan, granted bail

What just happened? Heather Morgan, who also uses the moniker Razzlekhan for her rapping career, has been released on bail following her arrest for allegedly laundering billions of dollars stolen in the Bitfinex hack of 2016. Her husband, apprehended at the same time as Morgan, remains in custody.

Last week brought news that Ilya “Dutch” Lichtenstein and his wife, Heather Morgan, had been accused of laundering Bitcoin stolen from the Bitfinex exchange six years ago. The 119,756 Bitcoin stolen in 2016 was worth about $61 million at the time but would be closer to $4.5 billion today. Last week, the DoJ seized about 94,000 of the stolen BTC valued at roughly $3.6 billion.

Federal agents were able to access the wallet containing the stolen Bitcoin in January after decrypting a file saved to Lichtenstein’s cloud storage account that contained 2,000 wallet addresses and their private keys. Blockchain analysis confirmed that nearly all of the addresses were directly linked to the hack.

Despite Chief US District Judge Beryl A. Howell describing evidence against the pair as “so weighty as to be overwhelming,” Morgan was allowed to post a bail of $3 million and told she could await trial at home once posted.

Lichtenstein’s bail offer of $5 million was rejected, and he must remain in a Washington D.C. jail—he was denied because the government alleges he was in control of most of the stolen funds. Both Morgan’s and Lichtenstein’s parents posted their houses as collateral for their bail.

The government argued that both individuals were a flight risk and could use the unaccounted Bitcoin—or the 70 gold coins they allegedly bought that can’t be found—to flee to a country where they are unlikely to be extradited, such as Russia (Lichtenstein was born in the country) or Ukraine.

In addition to Morgan being mocked for her toe-curlingly cringing rap videos, prosecutors noted that the lyrics from one of the tracks suggested she was no stranger to hacking: “Spear phish your password/all your funds transferred.” The number of burner phones, hollowed-out books, and hardware crypto wallets found in their apartment were probably quite incriminating, too.