Forfeiture

U.S. government seizes record $14B Bitcoin connected to Chen Zhi’s massive human-trafficking and cryptocurrency fraud network.

The U.S. Department of Justice (DOJ) has filed a civil forfeiture complaint to take control of about 127,000 BTC, worth around $14.2 billion.

The Bitcoin fortune is tied to LuBian and Cambodia-based businessman Chen Zhi, who is the chairman of Prince Group.

Record $14B Bitcoin Seizure

Arkham shared via X that Zhi ran large-scale human-trafficking and pig-butchering schemes across Asia. This type of exploit involves victims being tricked into fake online relationships and then convinced to invest in phony cryptocurrency platforms. Once they deposit money, the scammers take their assets and disappear.

Prince Group’s investment scams have led to billions of dollars in losses and suffering for victims worldwide, including in New York. Zhi remains at large, facing charges of wire fraud and money laundering conspiracy. Prosecutors allege that the illicit proceeds were used to purchase luxury yachts, private jets, artwork, and vacation properties.

On the other hand, LuBian was one of the biggest Chinese mining pools with facilities in China and Iran. The platform had been subject to the largest crypto heist ever in 2020, with hackers looting Bitcoin worth around $3.5 billion at the time.

According to the DOJ’s filing, LuBian was allegedly funded and operated using profits from criminal activities such as scams, human trafficking, and pig butchering schemes.

The blockchain analytics platform has confirmed that the stolen digital assets are now in the custody of the U.S. government, marking one of the biggest additions to the U.S. crypto reserves since their establishment in March under President Donald Trump’s executive order.

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DOJ Filing Sparks Questions Over Forfeited Bitcoin

The DOJ’s filing does not clarify how the Bitcoin came into U.S. custody, leaving open the question of whether the keys were hacked, voluntarily surrendered, or if the 2020 incident was actually a secret U.S. operation.

Meanwhile, on-chain investigator ZachXBT shared that wallet addresses listed in the government’s $14 billion seizure had been flagged in a Milky Sad report about two years ago for having exposed private keys. He pointed out that it now claims to have control of those wallets, suggesting that either a third party hacked them on behalf of the U.S. or the authorities did it themselves.

Additionally, the document details that the cryptocurrency was moved again between June and July 2024. It also mentions an incident involving a finance staff member who reportedly fled with funds and attempted to hide, an event that may be linked to the Bitcoin transfers during that time.