Bitfinex Hack and Laundering

IRAC Summary

Issue: Whether the individuals involved in the Bitfinex Hack and subsequent laundering activities are liable under criminal laws pertaining to computer hacking, theft of digital assets, and money laundering.

Rule: The applicable legal rules and regulations would include statutes related to computer fraud and abuse, theft, receiving stolen property, and money laundering. These may reference the Computer Fraud and Abuse Act (CFAA), anti-money laundering (AML) laws, and other relevant federal or state criminal statutes.

Application: The investigation would need to provide evidence that the individuals knowingly engaged in unauthorized access to the Bitfinex systems, stole digital assets, and attempted to launder those assets. Proving the intent and following the trail of transactions through blockchain analysis is crucial.

Conclusion: If the prosecution successfully presents evidence establishing the elements of the cybercrimes and money laundering beyond a reasonable doubt, the individuals involved in the Bitfinex Hack and laundering will be held criminally liable.

Detailed IRAC Outline


The primary legal issue is determining the criminal liability of the individuals who executed the Bitfinex Hack, stole cryptocurrency, and engaged in laundering the stolen funds. The issue extends to the characterization of cryptocurrency within the legal framework of theft and the application of anti-money laundering regulations to digital currencies.


  1. Computer Fraud and Abuse Act (CFAA): Establishes criminal liability for unauthorized access or exceeding authorized access to a protected computer, resulting in damage and loss.

  2. Theft and Receiving Stolen Property: State or federal laws defining the unauthorized taking of another’s property with the intent to permanently deprive the owner of that property.

  3. Anti-Money Laundering Laws: Include statutes that criminalize conducting financial transactions with proceeds known to be derived from unlawful activity to conceal or disguise the nature, location, source, ownership, or control of the illegal proceeds.


  1. Unauthorized Access and CFAA Violation:

    • Relevant facts include the method of the hack, evidence of the breach, and forensic data linking the individuals to the unauthorized access.
    • Analysis of how the individuals may have circumvented security measures and gained control over Bitfinex’s digital wallets.
    • Examination of digital footprints, IP addresses, malware, and any other tools used in the hack.
  2. Theft of Digital Assets:
    • The amount and type of cryptocurrency stolen from Bitfinex’s wallets.
    • Documentation of the transfer of stolen assets and control established by the hackers.
    • Testimony or evidence demonstrating the intent of the individuals to permanently deprive Bitfinex of their property.
  3. Money Laundering Activities:
    • Tracing the flow of the stolen cryptocurrency through various wallets and exchanges in an attempt to obscure its origin.
    • Use of mixing services, tumblers, or other anonymizing practices to launder the funds.
    • Identification of any attempts to convert the cryptocurrency into fiat currency, goods, or services.


The conclusion will synthesize the evidence and legal analysis to determine liability. It will assess whether the prosecution has met the burden of proof for each element of the relevant crimes. If the evidence is sufficient to establish that the individuals knowingly and intentionally accessed Bitfinex’s systems without authorization, stole digital assets, and engaged in a complex scheme to launder those assets, the individuals will be held criminally liable.

Discover more from Legal Three

Subscribe now to keep reading and get access to the full archive.

Continue reading