Bitfinex announces that the U.S. government has recovered and returned to the exchange just over 27 of the nearly 120,000 bitcoins stolen in a 2016 hack.

One of the features that many crypto enthusiasts love about the ecosystem is its Wild West nature. However, when things go wrong, it’s always good to have a sheriff hanging around. The Bitfinex cryptocurrency exchange suffered a hack back in 2016, but there is now some good news about this breach of security. The exchange has announced that federal law enforcement has tracked down and recovered 27.66270285 BTC from the hack and returned it to the exchange.

The Tin Star to the Rescue

In an article posted to Medium, Bitfinex states that they have been collaborating with law enforcement agencies from around the world after their hack back in 2016. Such collaboration has yielded some fruit.

The U.S. government notified the exchange in November 2018 that they had recovered bitcoins associated with the exchange’s security breach. To date, Bitfinex has recovered 27.7 BTC. The newly recovered cryptocurrency is being converted to USD and being paid to Recovery Right Token (RRT) holders.

Bitfinex Covered the Losses

The Hong Kong-based exchange took a different tack in responding to the 2016 hack that saw $72 million stolen. The exchange generalized the losses across all accounts and then credited users with BFX tokens at a ration of 1 BFX to 1 dollar lost.

Bitfinex notes that all BFX token holders had their tokens redeemed at 100 cents on the dollar or exchanged for capital stock in iFinex Inc., the parent company of Bitfinex, within just eight months after the hack. If someone bought shares of iFinex with their BFX tokens, they were also issued with tradable Recovery Right Tokens. The BFX tokens were destroyed after their use.

Due to the fact that all the BFX tokens are gone, the recovered bitcoins are now being converted and distributed pro rata to those holding RRT.

The chief financial officer for Bitfinex, Giancarlo Devasini, says:

Over two years following the hack of the Bitfinex platform, today we see the results of a clear and robust response strategy and the efforts of the U.S. government. It gives us great pleasure to be able to reimburse our traders that were loyal to us and believed in us at a very difficult time. We would like to thank U.S. federal law enforcement agencies for their ongoing efforts to investigate the security breach and their commitment to seizing and returning stolen assets. We will continue to assist law enforcement with their inquiries, and also once again extend an open invitation to the hackers, or anyone harbouring information pertaining to the breach, to make contact in whichever medium they feel most secure with, to finally resolve the situation in a mutually beneficial manner.

While the recovered bitcoins are just a drop in the bucket of what was stolen, it is nice to see some of the stolen BTC being found and given back to the exchange.

Were you affected by the Bitfinex hack back in 2016? Let us know in the comments below.

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