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The Ballad of Heather Morgan and Ilya Lichtenstein, Bitcoin’s Bonnie and Clyde

It was around 3 a.m. the first time they arrived. An unmarked, nondescript government-issued vehicle pulled up to the towering brown brick and blue glass building in downtown Manhattan known simply by its address: 75 Wall Street. The city that never sleeps was in that rare moment when the ostinato of car horns and rattling subway cars had been replaced by a deep, albeit brief, slumber. The agents stepped out of their vehicle and walked through the revolving doors of the 42-story building, crossing the shiny white oak floors of the lobby to reach the doorman on duty that night. It was 2021, in the midst of the second wave of the COVID pandemic, and the bottom 18 floors of “75,” which had originally opened as the Andaz Hotel, had shuttered because of the virus. Seeing anyone at this hour was rare for the doorman, but seeing a group of federal agents was an utter anomaly.

“We’re picking up signals that someone in this building is trafficking child pornography,” one of the agents said to the doorman. “We need to go up to the roof to see if we can track where the signal is coming from.” The doorman, though slightly taken aback, obliged and pointed the way to the elevators.

As the agents stepped in one of the building’s four elevators, the doorman wondered which resident of the 346-unit building, where condos can cost as much as $7 million, could be trafficking child porn. After a while, the agents came back to the lobby and left the building.

A couple of weeks went by and the feds returned. And again a few weeks after that. At one point, the night doorman offered them a little investigative advice. “You sure you’re in the right building?” he said. “Seems more like something you’d find at 95 Wall Street?” Indeed, 95 was far more malefic than 75. Over that same summer of 2021, the shiny glass building across the street had been the site of a series of drug busts by the NYPD; reviews of the building online had called it a haven for coke dealers, gangsters, and all-night Airbnb parties. Most recently, a high-end escort had been killed there, stuffed into a 55-gallon drum and wheeled out the back door before being dumped in New Jersey.

“Nope,” the agents said. “Definitely this building.” And off they went to the roof again. Then, one evening, the pattern changed. The agents showed an interest in one specific floor. The signal they were after, it seemed, was getting stronger.

In reality, the agents were not at 75 because of child pornography. The crime they tracked there had originally taken place in Hong Kong in the summer of 2016, when someone had found a flaw in the code of the Bitfinex crypto exchange and stolen 119,754 Bitcoin, worth around $72 million at the time. Its value had since grown 70-fold and was now in the billions. After a half decade tracking and tracing, climbing on roofs and skulking through the dead of night, the feds had finally—finally!—found the people who had somehow gotten their hands on that stolen Bitcoin. A married couple in their early 30s, with a wild online presence and a Bengal cat named Clarissa (who had her own Instagram account). The husband, Ilya “Dutch” Lichtenstein, a Russian-born émigré, was an investor and part-time mentalist magician. His wife, Heather “Razzlekhan” Morgan, who was from the U.S., was an entrepreneur, journalist, and rapper.

That was just the beginning, as I discovered in more than 50 interviews with friends and former colleagues of the couple, investigators close to the case, and employees and residents of 75 Wall Street. As the feds were about to find out, this would prove to be one of the strangest cases in the ever-evolving world of crypto crime—and the first clue of just how bizarre this case would become was sitting right there on the couple’s social media accounts.

“RAZZLE, DAZZLE, BITCHEZ!”

Ah, Bitcoin, a new era of money. That invention-slash-ideology that promised to usher in an era of glittering, sparkling, frolicking financial technotopia. Our generation’s fiscal Woodstock! And by God, did the internet need it. Back at the turn of the aughts, when this bizarre Bitcoin thing was slowly being squeezed from the birth canals of the web’s most arcane forums, financial anonymity simply didn’t exist online. You bought something digitally, and a database somewhere was tattooed with every microscopic detail about you.

Bitcoin, which made its hushed debut in 2009, promised to change that. It went on to upend the global financial landscape in ways that no one could have ever believed possible (anyone who tells you they foresaw the world we live in today is either a liar or a Bitcoin billionaire). Crypto now makes up $3 trillion in wealth, and the world’s largest financial institutions, including Chase and the Bank of England, cite digital currencies as the future of finance, although a major collapse in value this year has even some true believers wondering if that prediction will pan out.

The rise of cryptocurrencies also brought with it a new era of crime unlike anything we’ve ever seen before. Sites soon popped up on the dark web that made it easy to buy drugs, guns, murder, fake diplomas, ricin, body parts, bombs, rocket launchers, and even uranium, all using Bitcoin. And a few years later, because of that promise of financial anonymity, came the rise of a relatively obscure crime called the ransomware attack, where a company’s or person’s computer system is taken hostage and the only way to unlock it is by paying a fee in—you guessed it—crypto. While this kind of computer hijacking dates to the early ’90s, payment was often made by cash or credit card, and as such, was few and far between. Last year, the FBI released a report saying there are now 4,000 ransomware attacks every day (compared to seven bank robberies a day), and that online perpetrators stole $14 billion in Bitcoin in 2021 alone (traditional bank robbers, by comparison, only got away with a couple hundred million). Because of the ease of crypto, hospitals are now taken hostage and held at financial gunpoint. Banks and hedge funds grind to a halt. Even a meatpacking plant was recently forced to pay $11 million in Bitcoin to get access to its beef patties, chicken cutlets, and pork sausages.

Then there are the other crimes, where new waves of hackers phish, spoof, rootkit, worm, cloak, and brute-force their way into stealing all sorts of digital assets, from NFTs to literally (and sometimes figuratively) making off with millions in digital gold.

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