According to a recent report from Bloomberg, China’s cybersecurity department has openly accused the US government of orchestrating the theft of approximately $13 billion worth of Bitcoin (BTC), straining the ongoing cyber relations between the two nations. China Claims State-Level Operation The incident in question centers on the theft of 127,272 BTC from the LuBian Bitcoin mining pool in December 2020, constituting one of the most substantial crypto heists in history. Related article: Bitcoin Hits 300-Day Low: Top Expert Predicts Price From $38,000 to $50,000 China’s National Computer Virus Emergency Response Center suggests that this massive hack was likely a planned “state-level hacking operation” orchestrated by the US. The agency points to the discreet and delayed movement of the stolen Bitcoin as indicative of government involvement rather than typical criminal behavior. The report further links the Bitcoin of LuBian, a former Bitcoin mining company, to tokens seized by the US government that authorities claim are linked to Chen Zhi, the chairman of Cambodian conglomerate Prince Group. Chen Zhi was charged by the US with participating in a wire fraud conspiracy and carrying out a money laundering scheme in October. Notably, details about when and how Bitcoin was seized by the US remain secret. The narrative put forward in the report suggests that the US government may have employed hacking tactics as early as 2020 to appropriate the 127,000 Bitcoin linked to Chen Zhi, characterizing the operation as an example of a ‘black eat black’ maneuver orchestrated by a state-level hacking entity. Bitcoin Forfeiture Fallout Federal prosecutors involved in the Chen case have refrained from disclosing the methods used to gain control of Bitcoin, following the Justice Department’s civil forfeiture complaint that seized the 127,271 BTC, which is the most substantial forfeiture action taken by the US government. Recent statements from the Chinese government have highlighted a growing trend of accusing the US government of involvement in hacking activities. Related reading: Crypto Treasuries Shift Focus from Bitcoin and Ether to These Lesser-Known Altcoins Earlier this year, China alleged that the US was exploiting vulnerabilities in Microsoft Exchange servers to target Chinese companies. Just last month, China claimed it had undeniable evidence of a US cyberattack on the National Time Service Center. In response to the allegations, an attorney representing Chen Zhi has filed a request for additional time in a US court to trace LuBian’s stolen BTC. The lawyer, Matthew L. Schwartz, has criticized the government’s claims against Chen as “seriously misleading.” Schwartz, who is acting as counsel for Mr. Chen and the Prince Group, stated that they are working with cryptocurrency experts to trace the Bitcoin that was seized over a year ago and stolen in 2020. At the time of writing, BTC was trading at $102,550, recording losses of 3% in a 24-hour span. Featured image of DALL-E, chart from TradingView.com
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