A Chinese cybersecurity agency has publicly accused the United States government of orchestrating one of the largest cryptocurrency heists in history, alleging the theft of approximately $13 billion in Bitcoin. The claim escalates digital tensions between the two global powers, connecting the missing funds to a major US criminal case.
Key Takeaways
- China's National Computer Virus Emergency Response Center accused the US of stealing 127,272 Bitcoin in December 2020.
- The stolen crypto, valued at around $13 billion, was taken from the LuBian Bitcoin mining pool.
- The Chinese report labels the incident a "state-level hacker operation" and a "classic 'black eats black' operation."
- The US government seized a nearly identical amount of Bitcoin in a civil forfeiture case linked to Cambodian tycoon Chen Zhi.
- Chen Zhi was indicted by the US in October for wire fraud and money laundering, with prosecutors alleging he used LuBian to launder illicit funds.
Beijing Points Finger at Washington in Massive Crypto Heist
In a detailed report, China's top cybersecurity watchdog, the National Computer Virus Emergency Response Center, has leveled a serious accusation against the United States. The agency claims the US government was behind the December 2020 theft of over 127,000 Bitcoin from LuBian, which was once one of the world's largest Bitcoin mining operations.
The report suggests the sophistication and subsequent handling of the stolen assets are not characteristic of typical cybercriminals. Instead, it points to a coordinated, government-backed campaign. The agency described the operation as a "classic 'black eats black' operation orchestrated by a state-level hacking organization," implying one powerful entity forcibly taking assets from another.
This accusation is the latest in a series of public statements from Beijing alleging US-led cyber espionage and attacks. Earlier this year, China claimed the US exploited a Microsoft Exchange vulnerability to target Chinese firms and also presented what it called "irrefutable evidence" of an attack on its National Time Service Center.
A Pattern of Accusations
China's government has become more vocal in attributing cyberattacks to the US. These claims often coincide with periods of heightened geopolitical tension, though they are sometimes criticized for lacking the detailed forensic evidence that the US provides when it indicts foreign hackers.
The Connection to a US Criminal Case
The core of China's claim revolves around a massive seizure of Bitcoin by the US Department of Justice. The DOJ has filed a civil forfeiture complaint to seize 127,271 Bitcoin, an amount that is nearly identical to the number stolen from the LuBian mining pool.
These seized funds are directly linked to the US government's case against Chen Zhi, the chairman of the Cambodian conglomerate Prince Group. In October, US prosecutors in New York unsealed an indictment charging Chen with wire fraud and operating a large-scale money laundering scheme. Chen is not currently in US custody.
The indictment alleges that Chen and his co-conspirators used the LuBian mining operation as a vehicle to launder illicit proceeds. According to US prosecutors, crypto wallets associated with LuBian received substantial amounts of cryptocurrency from sources unrelated to its mining activities, suggesting it was being used to clean dirty money.
By The Numbers: The Heist and Seizure
- 127,272 Bitcoin: Amount stolen from LuBian in December 2020.
- 127,271 Bitcoin: Amount seized by the US DOJ in a civil forfeiture action.
- $13 Billion: Approximate current value of the cryptocurrency in question.
- October 8: Date of the US indictment against Chen Zhi.
Legal Battle Over Seized Funds
The timeline presented by the Chinese report suggests a preemptive strike by US authorities. "The US government may have already used hacking techniques as early as 2020 to steal the 127,000 Bitcoins held by Chen Zhi," the document states. This theory posits that the US hacked and secured the assets long before officially seizing them as part of the legal case.
Chen Zhi's legal team is now fighting to trace the seized assets. His attorney, Matthew L. Schwartz, recently filed a letter with a US court requesting more time to investigate the path of the Bitcoin stolen from LuBian. In a statement, Schwartz emphasized his team's efforts.
"As we explained in our submission to the Court, we are working closely with cryptocurrency experts to trace the Bitcoin that the government seized over a year ago, and which was stolen back in 2020."
Schwartz, who is the chairman of Boies Schiller Flexner, also described the US government's allegations against his client as "seriously misguided." The Department of Justice has so far declined to comment on how or when it gained control over the massive trove of Bitcoin.
Unanswered Questions and International Implications
The situation leaves several critical questions unanswered. The primary one is whether the US government actively hacked a foreign entity to secure assets related to a criminal investigation before a formal seizure was possible. If true, it would represent a significant and aggressive tactic in international cyber operations.
The competing narratives highlight the deep mistrust between Washington and Beijing. For China, it is an example of American overreach and digital imperialism. For the United States, it is part of a legitimate law enforcement action to dismantle a global money laundering operation that utilized cryptocurrency.
The case also underscores the complex challenges cryptocurrencies pose for international law. The decentralized and pseudonymous nature of Bitcoin makes it an attractive tool for illicit finance, while also creating jurisdictional gray areas that global powers may be willing to exploit. As Chen's legal team attempts to trace the funds and China continues its public pressure campaign, the fate of the $13 billion in Bitcoin remains a focal point of a much larger geopolitical contest.
