US seizes $3.36B Bitcoin connected to wire fraud in dark web

ANKARA

The US government seized $3.36 billion worth of Bitcoin connected to a wire fraud in dark web a decade ago, the Justice Department announced Monday.

James Zhong, who was accused of committing wire fraud in September 2012 when he unlawfully obtained over 50,000 Bitcoin from the Silk Road dark web internet marketplace, pled guilty on Friday, it said.

With a search warrant of Zhong’s house in Georgia, which has been unannounced until now, law enforcement seized more than 50,676 Bitcoin, which were then valued at over $3.36 billion in November last year.

As of Monday, 50,676 Bitcoin is worth a little over $1 billion, while the global crypto market has considerably shrunk since last year.

"For almost ten years, the whereabouts of this massive chunk of missing Bitcoin had ballooned into an over $3.3 billion mystery," Damian Williams, the US Attorney for the Southern District of New York, said in a statement.

Tyler Hatcher, the Special Agent in Charge of the Internal Revenue Service, Criminal Investigation, Los Angeles Field Office, said after Zhong stole Bitcoin from Silk Road, he hid them through complex transactions.

Silk Road marketplace, an online darknet black market, was shut down by the FBI in 2013.

This is the US government's second-biggest seizure of cryptocurrency, after $3.6 billion in stolen crypto was linked to the hack of exchange platform Bitfinex in 2016, which was announced by the Justice Department in February.