The Federal Bureau of Investigation (FBI) has arrested two people suspected of stealing and laundering over $230 million in Bitcoin BTC/USD.

What Happened: Malone Lam and Jeandiel Serrano were taken into custody on Wednesday night, according to a press release by the U.S. Department of Justice. The duo is accused of attempting to launder thousands of pilfered Bitcoins via mixing services.

They were slated to appear in separate federal courts in California and Florida on Thursday, the Justice Department said in a statement.

The authorities unearthed a sophisticated plan wherein the alleged thieves would drain cryptocurrencies out of victims’ accounts and then launder the proceeds through various mixers and exchanges using “peel chains,” pass-through wallets, and virtual private networks to conceal their identities.

The laundered funds were subsequently spent on extravagances such as international travel, nightclubs, pricey accessories, and luxury automobiles.

In the current case, the culprits robbed off 4,100 Bitcoin, worth $230 million, from a victim in Washington, D.C., last month.

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The theft was first reported by prominent on-chain detective ZachXBT, who, in a joint effort with security firms like CFInvestigators, zeroshadow, and the Binance Security team, helped investigators trace some of the stolen funds.

ZachXBT added that over $9 million of the stolen assets have been frozen, and more than $500,000 have been returned to the victim.

Why It Matters: This case underscores the increasing sophistication of cybercriminals and the challenges faced by law enforcement agencies in tracking and recovering stolen cryptocurrencies.

Earlier this month, the Federal Bureau of Investigation’s Internet Crime Complaint Center (IC3) revealed that Americans lost a staggering $5.6 billion to cryptocurrency-related frauds in 2023.

Alarmingly, the report indicated that while cryptocurrency-related complaints accounted for only 10% of all financial fraud reports, they represented nearly half of total financial losses.

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