The U.S. Federal Reserve (Fed) announced that it has seized and recovered $3.36 billion worth of Bitcoin stolen more than a decade ago from the black-market trading site “Silk Road.” This is the second-largest recovery of stolen cryptocurrency ever.
Yahoo finance reported on the 7th (local time) that James Zhong, who was accused of stealing astronomical amounts of bitcoins from “Silk Road,” a black market site that trades drugs and other illegal products, was convicted on the 4th. Zhong is expected to face up to 20 years in prison.
In September 2012, China seized about 50,000 bitcoins through nine accounts by targeting the blind spot of the Silk Road trading system. Since then, Zhong has sent cryptocurrency to numerous virtual accounts to avoid tracking.
Zhong has boldly established a company called “JZ Capital” in 2014 and pretended to be an expert on bitcoin investment and computer programming. Zhong also uploaded photos taken with luxury yachts and personal airplanes on his social media (SNS).
China’s “good times” ended in 2021 when the U.S. Department of Justice, which had some doubts about China, raided his residence without any notice. During the raid, the Ministry of Justice seized 56,676 bitcoins, including 25 of Cassius coins (physical bitcoins). At that time, the Ministry of Justice reportedly found all the cryptocurrencies that were scattered and hidden here and there. A spokesman for the Ministry of Justice noted that the cryptocurrency wrapped in a blanket was also hidden in the popcorn bin in the bathroom closet of Zhong’s home.
Prosecutor Damian Williams said, “We have recovered the stolen bitcoin that has been under the veil for more than a decade.” This is the second largest ever after the $3.6 billion cryptocurrency recovery stolen by Bitfinex hacking in 2016.
However, due to the weakness of Bitcoin since 2021, the value of 50,000 bitcoins seized by the Ministry of Justice at the time is currently about 100,000 dollars.