The US seized $14 billion in Bitcoin, exposing a global network of slave labor and money laundering. Photo: Blockworks
US seizes record $14 billion worth of Bitcoin
- From a flashy businessman who called himself “Cambodia’s youngest billionaire”, Chen Zhi turned blockchain into the perfect crime machine: fraud, money laundering, forced labor and torture. Now, his dark crypto empire has collapsed under the hands of the US Department of Justice, along with the largest Bitcoin seizure in human history.
- According to an announcement from the U.S. Attorney's Office for the Eastern District of New York and the National Security Division (NSD), 127,271 BTC (worth more than $14 billion) were seized from Chen Zhi's personal wallet, which he kept the private keys for himself, making it extremely difficult to trace.
List of addresses cited in the court filing https://t.co/a0cQ8niNkb pic.twitter.com/B21jI270NK
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- This is the largest digital asset seizure in the history of the US Department of Justice , far surpassing previous cases such as Silk Road (50,000 BTC) or Bitfinex (95,000 BTC).
- After the asset freeze, the total amount of BTC held by the US government increased to more than 325,283 BTC, worth 37 billion USD , consolidating the US's position as the country that owns the largest Bitcoin in the world, even though the country has never "stored" any BTC for the national reserve fund .
- Before freezing the above Bitcoins, the US government's reserves stood at $22.3 billion (197,354 BTC).
Statistics of assets in the wallet cluster believed to belong to the US government. Source: Arkham (October 15, 2016)
“Crypto tycoon” disguised as billionaire
- The case originated from a huge crypto crime network operating in Cambodia, led by Chinese citizen Chen Zhi, who is currently being prosecuted on two counts of conspiracy to commit wire fraud and conspiracy to commit money laundering.
- Zhi is behind a global crypto investment fraud network, operating under the name Prince Group Transnational Criminal Organization - a system with more than 100 shell companies, spread across more than 30 countries.
- This network is designed as a parallel economic empire, both sucking money from investors and laundering shady Capital through a chain of "legal" projects in the fields of real estate, tourism, and even mining Bitcoin through Warp Data Technology to legitimize the flow of money.
- US prosecutors say Zhi's network went beyond financial fraud. Investigators allege he oversaw and directed a range of other illegal activities, including:
Sexual blackmail, forcing victims - including minors - to send sensitive images to threaten and blackmail.
Corruption, money laundering, illegal online gambling, and many other forms of “pig butchering” investment fraud have caused billions of dollars in losses.
Using slave labor to run the scam - thousands of people forced to work in closed “compounds” in Cambodia.
Hell in the heart of Southeast Asia
- According to documents from the DOJ, The Guardian and Chainalysis, Zhi's network operates at least 10 "scam compounds" in Cambodia and is described as a "technological hell" . Specifically:
Workers were held behind barbed wire fences, beaten and tortured if they did not meet fraudulent quotas.
Some victims were bought and sold like commodities, for between $1,000 and $3,000 each.
There has been at least one recorded death - Yi Ming Dali, a Chinese worker, was murdered at the compound in 2023.
- This is no longer a mere financial case, but the most serious human rights investigation involving crypto ever recorded.
- The US Treasury Department said this campaign was the result of three-party coordination between:
Office of Foreign Asset Control (OFAC);
Financial Crime Enforcement Network;
UK Foreign, Commonwealth and Development Department (FCDO).
- OFAC imposed sanctions on 146 individuals and entities linked to the Prince Group network, while FinCEN activated Section 311 of the PATRIOT Act to disconnect Huione Group - the network's back-office money laundering organization - from the US financial system.
- Furthermore, the UK and the US have simultaneously frozen a series of Zhi's luxury assets in London, including a £12 million mansion and a £95 million office building, which have been identified as money laundering assets.
US Treasury Department: “There is no safe place for transnational crime”
“Cross-border fraud has cost Americans billions of dollars – many Ashdraked in minutes,” said US Treasury Secretary Scott Bessent. “We will continue to take strong action to protect our citizens from foreign fraudsters.”
- He affirmed that the US will continue to lead in cracking down on global cybercrime, coordinating with international law enforcement agencies to destroy the industrial-scale money laundering and fraud ecosystem.
- According to blockchain analysis organizations such as TRM Labs and Elliptic, the origin of the seized Bitcoins may also be related to the 2020 hack targeting Bitcoin mining pool LuBian , raising suspicions that the Prince Group network used stolen BTC to legitimize money laundering activities.
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