The U.S. government has confiscated 127,195 Bitcoin, associated with Chen Zhi’s so-called “pig butchering” scheme, which is one of the largest crypto scams ever discovered.
This move brings total US government-held crypto holdings to record levels and signals a crackdown on global cryptocurrency-related scams.
The government said that the Bitcoin seizure was part of a larger effort targeting Zhi’s network, which supposedly stole from thousands of victims worldwide through a series of complex online scams.
The stolen crypto tokens, which are worth about $15 billion, were traced to wallets belonging to the Cambodian businessman’s associates.
A Breakdown of the Seized Bitcoin Holdings
Bitcoin seized by the U.S. government is now available in the government’s crypto wallet.
Following the recent seizure of 127,195 BTC from Chen Zhi, the majority of the government’s holdings now consist of cryptocurrencies from earlier scams.
The Bitfinex theft was 106,910 BTC, the Silk Road case was 81,988 BTC, and the Potapenko/Turogin case was 667 BTC.
Together these holdings make the U.S. government some of the largest institutional holders of bitcoin in the world, competing with even large private entities and exchange treasuries.
Authorities have yet to determine whether the assets seized will be auctioned, stored, or put to use as evidence in criminal proceedings in progress.
In the past, parts of the recovered digital assets have been sold at public auctions, attracting the attention of institutional buyers.
Inside Chen Zhi’s “Pig Butchering” Network
Pig butchering, also known as “Sha Zhu Pan,” is a form of scamming where scammers create false relationships with their victims, usually romantic or friendly relationships.
Once the victim has been lured in, trust is established, and the victim is then persuaded into investing in what seems like legitimate cryptocurrency investments. They see fake profits build up only for it to all come crashing down when the platform evaporates and the scammers fade away.
The FBI said these scams have surpassed $5.8 billion in losses in 2024, thereby constituting one of the most rapidly expanding financial crimes on a global scale.
Chen Zhi, who is estimated to be 37 or 38 years old, is alleged to be the leader of a transnational criminal organization that operates this business via his company, Prince Holding Group, which is based in Cambodia.
Allegedly his network was responsible for using prison laborers as slave labor in fraudulent compounds, with workers being forced to control thousands of fake accounts and messaging platforms.
The group’s activities were focused on victims in North America, Europe, and Asia.
Ongoing Investigation and Crackdown Worldwide
Chen Zhi has been indicted in the United States for fraud and money laundering, and the Treasury Department has imposed sanctions on his conglomerate.
The departments affirm the confiscation of 15 billion worth of Bitcoin from Zhi’s network. Despite these efforts, Chen Zhi is still on the run, reportedly still living in Cambodia.
Law enforcement agencies are continuing to work with international partners to track down and bring him to justice as the global community continues to work to break down crypto-fueled fraud networks.
