banner

Advertisement

U.S. Authorities Seize $1B Worth of Bitcoin from Silk Road Heist

Bitcoin Keys Were Stashed in Underground Safe and Devices

U.S. Authorities Seize $1B Worth of Bitcoin from Silk Road Heist

The U.S. Department of Justice said Nov. 7 that it seized more than 50,000 Bitcoin stolen from darkweb marketplace Silk Road a decade ago.

In November 2021, the authorities searched the home of one James Zhong and seized 50,676 BTC, worth over $3.4B at the time and about $1B today. The stash was found in an underground floor safe and on a “single-board computer that was submerged under blankets in a popcorn tin stored in a bathroom closet.”

Guilty

On Nov. 4, Zhong pleaded guilty to one count of wire fraud, which carries a maximum sentence of 20 years in prison.

“Thanks to state-of-the-art cryptocurrency tracing and good old-fashioned police work, law enforcement located and recovered this impressive cache of crime proceeds,” said U.S. Attorney Damian Williams.

Along with the Bitcoin, law enforcement also seized various precious metals and cash found in Zhong’s residence in Gainesville, Georgia.

Get Smarter on DeFi and Web3

Get the 5-minute newsletter keeping 80K+ crypto innovators in the loop.

Mystery Solved

The current market value of the seized Bitcoin stands at roughly $1B. At the time, it was the largest financial seizure in the department’s history. However, February’s seizure of 94,000 BTC worth $4B related to the Bitfinex hack has pushed it into second place.

LEOBitfinex2

Bitfinex’s LEO Token Explodes After US Seizes $4B of Bitcoin Lost in 2016 Hack

Bitfinex’s LEO token surged after news of a $4B seizure of Bitcoin stolen from the exchange in a 2016 hack.

The Defiant The Defiant

According to authorities, Zhong created nine fraudulent accounts and made 140 transactions in quick succession in order to trick Silk Road’s withdrawal process into sending him over 50,000 BTC, which he subsequently withdrew to various addresses controlled by him.

Zhong began cooperating with authorities in March and has voluntarily given up 1,004 BTC. He is due to be sentenced on Feb. 22, 2023.

Get Smarter on DeFi and Web3

Get the 5-minute newsletter keeping 80K+ crypto innovators in the loop.