The US Government claimed today that Bitfinex exchange is the “sole victim” eligible for restitution
The US government has filed a claim in District Court, stating that Bitfinex is the "sole victim" entitled to restitution under the Crime Victim's Rights Act (CVRA) and Mandatory Victim Restitution Act (MVRA) following the 2016 hack.
The government has recovered billions from the hack but has yet to allocate these funds due to a surge of private claimants.
Bitfinex Hack Fallout: Government Singles Out Exchange for RestitutionThe United States government has asserted that cryptocurrency exchange Bitfinex is the “sole victim” eligible for restitution, as defined by 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, D.C., regarding the 2016 Bitfinex hack.
According to the filing, the government is not aware of any other individuals who qualify as victims under the CVRA or for restitution under the MVRA, aside from Bitfinex itself. However, the government filed this claim "out of an abundance of caution" to notify the public, particularly former account holders, and provide them with an opportunity to advance potential claims.
In essence, the federal government is singling out Bitfinex as the primary channel for former exchange users to recover their funds. This move comes after the Department of Justice seized over $3.6 billion in stolen assets in 2022, attracting a massive wave of claimants. Sorting through legitimate and fraudulent claims has posed a particular challenge for law enforcement.
Bitfinex has been cooperating closely with authorities to get its customers’ money back. In 2023, the exchange announced that the government returned over $312,000 in cash and Bitcoin Cash (BCH) but no other assets. Its 2023 restitution plan involved paying out Bitfinex’s LEO token holders, and LEO spiked 40% following today's filing.
The filing explicitly outlines the intended path for defrauded users to recover their funds. The government will only make recovery payouts to Bitfinex, and any private claims should be directed to the exchange.
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