Two individuals accused of laundering proceeds from the 2016 Bitfinex hack were released on bond after claiming their innocence in a New York courthouse Tuesday.

Ilya “Dutch” Lichtenstein and Heather Morgan were arrested Tuesday by federal officials on charges stemming from a 2016 hack of the Bitfinex cryptocurrency exchange. The U.S. Department of Justice also said officials seized 94,000 BTC, worth over $3.5 billion at today’s prices.

Prosecutors sought pretrial detention during the hearing this afternoon, arguing the pair might be a flight risk. Magistrate Judge Debra Freeman, of the Southern District of New York, sentenced Lichtenstein to home detention with a wearable GPS and a $5 million bond, while Morgan got the same with a $3 million bond.

The parents of both defendants were required, as a condition of the bond, to pledge their homes as collateral. The couple will spend at least Tuesday night in jail, pending an investigation by pretrial services officers.

The government initially asked for a $100 million bond, which was quickly rejected. The defense countered with $1 million, which was also rejected.

Lichtenstein must obtain signatures on his bond from five people, the judge ordered. Morgan was required to get two, which her parents agreed to provide.

Defense attorneys told the court that Morgan has health problems (including recent breast surgery) and that incarceration would be dangerous for her. She gets migraine headaches when exposed to bright lights and had to go to the hospital Tuesday after her arrest around 7 a.m. Eastern time, her attorneys said.

According to a criminal complaint attached to the DOJ press release, the two are both being charged with money laundering conspiracy and conspiracy to defraud the United States. They are not being charged with conducting the hack itself.

Read more: US Officials Seize $3.6B in Bitcoin From 2016 Bitfinex Hack

An attached statement of facts further alleged that Lichtenstein and Morgan had control of a crypto wallet which held the proceeds from the 2016 hack, as well as numerous other addresses. All told, the two were allegedly in control of 2,000 different addresses and their corresponding seed phrases, which were recorded on a spreadsheet saved to a cloud storage service used by Lichtenstein.

According to Cornell Law School’s Legal Information Institute, the first charge carries a maximum sentence of 20 years in prison, no more than twice the value of the property involved or both, while the second charge carries a maximum sentence of five years in prison and/or fined.

Depending on how the case proceeds, prosecutors can seek a lighter sentence or a judge can choose to impose a below-maximum sentence. Tuesday’s hearing was intended to determine whether the defendants would be held in pre-trial detention.

Defense attorneys said the defendants have “been aware” of the investigation since at least this past November after one of their service providers received a subpoena, but had not fled ahead of their arrest. This was the reason the judge said she granted bail.

Prosecutors said during the hearing that the defendants had a file on their computer titled “The Passport_Ideas” with information about obtaining passports through darknet markets.

Read more: 'Like Genghis Khan, but With More Pizzazz': What We Know About the Accused Bitfinex Money Launderers

“Here's what I'm thinking, on flight risk the standard is a preponderance of the evidence. It's clear that the defendants have means, have traveled, and that the charges are serious. I'm troubled by the cloud-based account about passports,” Freeman said during the hearing.

One of the defense attorneys said the file was meant to open financial accounts, rather than facilitate a flight to safety.

A plastic bag full of cell phones, labeled "burner phones," was found under the couple's bed, prosecutors said in court.

As a condition of their bond, the defendants are allowed to spend up to $10,000 a month on living expenses but they are forbidden to drain their bank accounts or make any cryptocurrency transactions, the judge said.

Another condition: the couple's cell phones and computers will be confiscated and they will be given a flip phone and one internet-connected device, monitored by pretrial services, so they can access their bank accounts and email their lawyers.

Nikhilesh De contributed reporting.

UPDATE (Feb. 9, 00:15 UTC): Adds details from the hearing throughout.