Silk Road Saga: US Authorities Seize $3.36 Billion In Bitcoin From James Zhong
Summary:
- The U.S. Department of Justice confiscated some 50,000 Bitcoin linked to the Silk Road platform.
- Authorities seized BTC valued at $3.36 billion at the time from one James Zhong in November 2021.
- Zhong pleaded guilty to defrauding the dark web marketplace of digital assets.
U.S. prosecutors seized over 50,000 Bitcoin (BTC) from a defendant in connection to the Silk Road, a dark web marketplace created by Ross William Ulbricht in 2011.
Monday’s official statement from the U.S. Justice Department said authorities discovered around 50,676 BTC on November 9, 2021, after searching the Georgia residence of James Zhong.
Crypto’s leading digital token BTC set a new $68,000 all-time high on November 10, 2022, per TradingView data. This means that at the time of the discovery, the over 50,000 Bitcoin seized by authorities was worth an estimated $3.36 billion.
Zhong’s Theft From Silk Road’s Bitcoin
The Justice Department indicted Zhong on fraud charges as U.S. Attorney Damian Williams explained. Williams said that Zhong “committed wire fraud” around September 2012 and that the defendant “stole approximately 50,000 Bitcoin” through a series of transactions.
In September 2012, ZHONG executed a scheme to defraud Silk Road of its money and property by (a) creating a string of approximately nine Silk Road accounts (the “Fraud Accounts”) in a manner designed to conceal his identity; (b) triggering over 140 transactions in rapid succession in order to trick Silk Road’s withdrawal-processing system into releasing approximately 50,000 Bitcoin from its Bitcoin-based payment system into ZHONG’s accounts…
Authorities stressed that Zhong also spread the stolen BTC across multiple wallet addresses in an attempt to hide the loot.
On November 7, 2022, Zhong pleaded guilty to stealing Bitcoin from the Silk Road marketplace. Ulbricht, who created the dark web platform, is serving out two life sentences after a conviction in February 2015.
