Over 50,000 Bitcoins that were stolen from the online black grocery store Silk Road have been appropriate by US authorities . When the cryptocurrency was impound it was worth $ 3.36 billion , making the pinch the US Department of Justice ’s ( DOJ ) largest cryptocurrency seizure ever at the time .
On November 4 , 32 - year - onetime James Zhong plead guilty to trust wire fraud in September 2012 when he unlawfully obtained over 51,680Bitcoinfrom Silk Road .
The slip stash of crypto was found during a search of his plate in Gainesville , Georgia , that take place in November 2021 , but authorities have only just releaseda public statementabout the case following his guilty plea .
Another photo taken during the rain on Zhong’s home. Image credit: US DOJ
For the nine year between the criminal offence and the raid , the whereabouts and identity element of Zhong were uncertain . Nevertheless , natural law enforcement eventually manage to pinpoint the culprit using , what they call , “ state - of - the - art cryptocurrency tracing and good onetime - fashioned police body of work . ”
“ James Zhong committed wire fraud over a 10 ago when he stole approximately 50,000 Bitcoin from Silk Road . For almost ten years , the whereabouts of this monolithic chunk of missing Bitcoin had inflate into an over $ 3.3 billion mystery , ” US Attorney Damian Williams said in the program line .
In February 2022 , officialsseizedmore than 94,000 Bitcoin , valued at around $ 3.6 billion at the time , which overtook Zhong ’s case as the largest ictus in US history . Even today , however , this new case remains the DOJ ’s second - big financial raptus ever .
Yet another from the raid. Image credit: US DOJ
Since thefalling fortunesof crypto this class , the stash has lost over two - thirds of its time value and is now worth around $ 972 million , as of November 8 , 2022 .
Catching Zhong was no pocket-size feat . The cryptocurrency was stored on a number of different “ dusty wallet ” hard drives dotted around his house , including some in an underground floor secure . One stash was even stored on a circuit control board that was submerged under cover in a popcorn tin stored in a privy closet .
Before they even identified his whereabouts , identifying Zhong was not easy given the namelessness built into cryptocurrency exchangeson the blockchain .
He deplume off the telegram fraud attack in September of 2012 by creating at least nine fake accounts on Silk Road , thedark entanglement marketplacewhere users can buy drugs and other illicit products using cryptocurrency . The marketplace ’s founder , Ross Ulbricht , is now serving a life sentence time in prison .
Zhong managed to detect a room to touch off over 140 dealing in speedy ecological succession for play a trick on Silk Road ’s withdrawal processing system into exhaust approximately 50,000 Bitcoin from its payment system . The loot was then disperse into multiple account statement and was then transfer to multiple Bitcoin wallets .
In August 2017 , a transfer made by Zhong allowed investigators to track the escape coins to accounts on an unnamed cryptocurrency substitution , which eventually led them to his identity .
“ Mr. Zhong executed a sophisticated strategy design to steal bitcoin from the notorious Silk Road Marketplace . Once he was successful in his stickup , he attempted to hide his spoils through a series of complex dealing which he hope would be enhanced as he hid behind the mystery of the ‘ darknet . ’ IRS - CI [ Internal Revenue Service , Criminal Investigation ] Special Agents are the good in the world at following the money through cyberspace or wherever our fiscal investigations lead us . We will uphold to work with our partners at the US Attorney ’s Office to cut across down these criminals and bring in them to jurist , ” added IRS - CI Special Agent in Charge Tyler Hatcher said .
Zhong is sic to schedule to be doom on February 22 , 2023 , on one numeration of telegram fraud , which carries a maximal sentence of 20 years in prison house .
