Wow. $15 billion is an astronomical, nearly unfathomable amount of money in Cambodia. This must have been a huge operation. It's almost 1/3 of the country's entire GDP!
Well done DOJ. Hopefully the victims get their money back.
Compared to Cambodia, sure, but it's an international crime gang, with this particular one being just one branch. I wonder if this was their biggest hoard or if they had more?
Really poor financial management to have all that money concentrated that much though. It either means they dropped the ball bigly, or this is spare change for them... although Bitcoin's market cap is $2.24 trillion at the moment, $15 billion is a significant chunk of that.
That doesn't appear to be how they seized the funds though, the criminal hasn't been caught so they must have hacked his devices to gain access to the private keys. No $5 wrench involved.
Probably not, but we should probably not compare a total (potentially across years) with something that is measured yearly like GDP, kind of misleading.
not really? presumably many people transfer via platforms like Coinbase that use a shared wallet system. You can't just "send the money back where it came from" as those wallets might not actually be controlled by the funds owner.
Even if the victims get their money back it would only account for 25% or so because the price of BTC has moved so far since they lost it. (I think many victims will successfully petition for their money back)
That’s not necessarily true, though may be for Cambodia. GDP can include black market activities but countries differ in whether they include specific ones and how.
Does it even count in there though? Fraud isn't a normal transaction. It's the same as theft, which is simply a transfer from one person to another. An act of fraud or theft doesn't represent creation of value the way profit from legitimate transactions do for "black market" goods/services (even if the goods/services are illegal).
Right, it's not black market if you eventually pay some taxes on it somewhere. Dare we call it washed money, and for our American friends in the audience, laundered money.
That money would have flowed somewhere, also I'm not sure OP was talking about impacting the GDP just quantizing it. For Cambodia, it's an extraordinary amount of money. Actually for anywhere it's a ridiculous amount of money.
Instead of these two take this simple rule: not your key not your money.
There's no thing that the feds can't have because they have an infinite amount of sanctions violence and tools at their disposal to make anyone do what they want, one way or another.
Criminals can’t count on #1 if they hold the keys on them when they get arrested.
>were previously stored in unhosted cryptocurrency wallets whose private keys the defendant had in his possession. Those funds (the Defendant Cryptocurrency) are presently in the custody of the U.S. government.
With the recent insane moves in quantum stocks almost makes me wonder if there’s a possibility the NSA or other USG agency is far enough ahead of publicly known capabilities in quantum computing to brute force private keys/break encryption and this info is leaking into markets.
Of course the more likely explanation is that this was a sophisticated albeit classical hack (infrastructure, social engineering, surveillance, whatever) and the quantum run-up is unrelated retail investor hysteria, but have to consider the possibility the market knows something I don’t. If the government stays far ahead enough of private industry at some point in the coming years (or decades) the USG will break encryption without public disclosure unless quantum resistant algs are put in place before that capability is achieved. Hopefully this more exotic implausibility isn’t the explanation, but entertaining to consider, and history is bizarre enough for it to be true.
It's 127,271 Bitcoins. Interesting choice not to mention the number of Bitcoins but use its current market value in USD. I feel like this says something about Bitcoin but not sure what exactly.
Edit: Wow, people really don't want to know how many Bitcoins were seized :)
It says Bitcoin is not a standard denomination. Sort of like if you are in France, and Disney bought Discovery, you would want to know the buying price in euros, not US dollars.
This is why crypto could never be considered a currency, even the earliest news about BTC (value, theft, pizza purchases, etc) was always reported in USD values.
This is regular reporting using end-consumer market rates to inflate numbers.
Just as you could not sell 127,271 bitcoins all at once at market value, you could not just sell cocaine worth $1.4 billion but still confiscated drugs, even in large quantities, are reported with end consumer market rates. Nowadays, if a report mentions that is talking about "street value", that is already a big plus in my book.
Long overdue. At some point, these scam operations are so large that they have to be operating with tacit approval of their host countries, who have been given no incentive to stop the virtual cold war against the personal finances of foreign citizenry that is bringing in millions of dollars into their economy.
> The company is linked to Cambodia's ruling Hun family, which includes the current prime minister, Hun Manet.[4] His cousin Hun To is a major shareholder and director of Huione Pay
> Cambodia's specifically 30-50% of the economy can be directly attributed to scamming plus casinos
Are you saying that 30-50% of Cambodia's economy can be directly attributed to scamming and casinos? I find that shocking and hard to believe. Do you have a source for that statement?
First off, the amount seized was not necessarily made in a year.
Second, most of the money would not make it to the Cambodian economy. It is likely laundered abroad. The whole operation is likely multinational, with only the workforce located in Cambodia.
This makes me think of the Barbary Wars where piracy out of the Barbary states was a huge issue. There's also the connection with the slave trade then and the human trafficking for the scam centers now.
> the virtual cold war against the personal finances of foreign citizenry
Comparing a scam to war is inaccurate. The Cold War was a war running cold with the potential to go hot. Cambodia and America are not going to war over this.
Interestingly enough, China is thought to have leaned on the scales in Myanmar’s civil conflict due to pig-butchering there. (Not only were they scamming Chinese, they were also human trafficking them to operate the scams.)
China only began executing those pig-butcherers when the EAO that was providing protection to Chinese pig-butchering gangs in that region of Myanmar (Kachin Independence Army) re-flipped towards India recently [0] and had begun to ignore China [1] and rerouting rare earths and other goods to India [2]
Meanwhile, China never cracked down against similar scams in Cambodia. Most notably, Prince Group remains unsanctioned in China and it's leadership are Mainland Chinese in origin.
While pig butchering (along with opium and human trafficking and other organized crime activities) are a major reason behind Chinese involvement in Myanmar, ignoring the very real proxy war going on between Chinese and Indian interests in Myanmar fails to contextualize some of the decisions that both countries make within Myanmar.
This also explains why you don't see a similar crackdown in Cambodia, which is solidly within the Chinese sphere at this point.
> the EAO that was providing protection to Chinese pig-butchering gangs in that region of Myanmar (Kachin Independence Army)
Kachin is not a relevant location of scam centers. You can find articles that claim otherwise, e.g. https://www.ctol.digital/news/inside-worlds-largest-scam-emp... but from the fact that they mention the Thai border and the city of Myawaddy, which is in Kayin/Karen State, it's clear that they're just confusing Kachin and Kayin.
The Kachin Independence Army seems to finance itself through mining instead.
While it's true that some scammers were recently sentenced to death in China https://www.bbc.com/news/articles/c78nrx309kzo and this only happened after the Kachin Independence Army disrupted the rare-earth trade with China, that's just a temporal coincidence. The scammers were captured in 2023 in Laukkai in northern Shan State near the Chinese border by the MNDAA (an anti-junta armed group dominated by ethnic Chinese) as part of Operation 1027. China is rumored to have assisted the operation in order to crack down on the scam centers in junta-controlled territory. https://en.wikipedia.org/wiki/Operation_1027#Cyber-scamming_... The Kachin Independence Army also participated in Operation 1027, but in Kachin, not Shan.
That's interesting - I had seen some news articles reporting that some Chinese pig butchering scammers were encouraging others to target foreigners only, and exclude the mainland Chinese. Like this one: https://globalinitiative.net/analysis/chinas-acquiescence-to...
It's reminiscent of stories about Russian malware doing nothing on machines with Cyrillic keyboard layouts.
Yep, but notice how that article is about Kokang in Myanmar as well.
Cambodia continues to have scam centers targeting Putonghua speakers (including PRC nationals), but there hasn't been a similar crackdown on such activities due to Chinese pressure.
The crackdown in Kokang happened after China flipped to supporting the Tatmadaw against the Northern Alliance [0] and India began peeling historically India-aligned members of the alliance like the KIA and the Arakan Army back into Indian orbit [1].
P.S. Circa 2 years ago, a large portion of Chinese in SF Chinatown became Kokang and Cambodian Chinese. Bamar, Kuki-Zo, and Kachin Myanmarese primarily reside in Daly City, Ingleside/Outer Mission, and Oakland/East Bay.
SF has a lot of Asian and Latiné subcultures and communities - it's kind of insane how underdocumented it is under the guise of "Asian" and "Latino"
> we are at war with many countries all the time, most of it is cold
Like whom? We (and let's be honest, every other great power) are at war with many countries all of the time, and while they may be cold for long stretches, they absolutely (a) go hot from time to time and (b) are constantly threatening to go hot.
To me "war" is a state of "no rules" hurting. IE nuclear, biological, any weapon goes. Anything less is an exercise in restraint - even if still quite terrible in it's own right.
Which means there are lots of "exercises" of varying lethality, risk profiles, spheres of influence, etc. And yes many countries are jockeying against other countries in varying ways.
Large scale scams against other countries could be seen as an unintended (not a planned government action) exercise that is condoned by the government.
The point of bitcoin was that it can't be taken off you by the state. So either this was severe user error, to the tune of why aren't the keys somewhere secure when there's a billion dollars behind them, or the nominal reason for bitcoin existing is nonsense.
We thinking user error or crypto is nonsense? On the forum I expect the former.
Btw this is low-key the reason why Cambodia almost went to war with Thailand recently. In particular what's interesting is that how quickly Cambodia repurposed scam center employees as internet trolls. They're onto a really powerful golden goose here that not only brings in 15B usd but also empowers the current dictatorship. But also it's a pit of doom that is destined to erupt anytime now.
I'm curious how the Bitcoin was actually seized, given that the indictment says the perp is still at large and held the Bitcoin in self custodied wallets.
I'm not sure if one can merely walk away from a criminal enterprise of that size. As soon as you stop paying certain people you end up in a cage, and unless the stream of money is constant there is no reason to just not reneg on all prior agreements and go in a cage for stuff you already paid authorities off for.
So the whole crypto anonymity thing isn’t actually real? As it turns out, tracing people is still easier than tracing money? Decentralized economies are run by criminal enterprises?! We aren’t safe!?!
Wonder how this whole concept overlays onto LLMs, with a lot more money on the line and a lot less regulation.
You're probably joking, but even if crypto was totally anonymous, running a massive criminal human trafficking empire in the real world is very non-anonymous.
Good old police work still works. Because people need to talk to each other to do stuff. The only time anonymity helps is if you can pull it all off solo, and mix the funds enough to not be traced as well as cover tracks well enough.
Crypto anonymity is still possible if you don't plan to spend your ill-gotten millions or billions particularly quickly. But, of course, you don't get to having a massive active criminal empire that way.
These scams have enormous scale. The Economist has a fascinating podcast about it. The full series requires a subscription, but it is worth at least listening to the first 3 free episodes. https://www.economist.com/audio/podcasts/scam-inc
They have shareholders who bought the shares for more than the company annual revenue and expect infinite potential of profits to justify the price they paid
Chances are they still have a lot of the money scammed, just not those particular 15B.
In a way it's like with an overfunded startup: when at some point in time the music stops because even the last would-be investor realized that the business will never be profitable, the company collapses. But all those paychecks received for playing with Other People's Money don't magically return.
Sounds like good news but the press release doesn't detail how the FBI managed to trace, positively identify and then seize such a huge pile of crypto ($15B) from a suspect they say took extensive steps to launder and hide the source and ownership of the crypto. I'm curious because this guy is clearly very experienced, highly sophisticated and located in a country where the government and law enforcement are obviously tacitly protecting him.
So did the U.S. hack this guy? Anyone who manages to build such a massive multi-national corporation with myriad illicit businesses but also dozens of legitimate businesses with thousands of employees - including a large bank with over 100,000 customers - and then operate it all for over a decade, doesn't strike me as someone who's trivially careless. I mean he managed to successfully protect that much money for a long time from his own criminal co-conspirators (who would certainly include hackers with insider knowledge of his operations), criminal competitors and all the people he was bribing like senior Cambodian politicians, law enforcement and intelligence agencies.
This just strikes me as either a very lucky break or a perhaps a sign that the FBI is adopting a new playbook to go after shielded international operations like this. Like maybe involving U.S. and 'Five Eyes' intelligence assets.
"but the press release doesn't detail how the FBI managed to trace, positively identify and then seize such a huge pile of crypto ($15B) from a suspect they say took extensive steps"
Am I slow??? or what under circumstance that you expect FBI to told press how their operate????
I am also curious how the US government obtained possession of the bitcoin if the defendant is still at large. Doesn’t that defeat the whole point of bitcoin?
According to Ars Technica: "Adding further mystery, it’s unknown how federal officials managed to obtain the cryptographic keys required to seize the funds from Zhi."
My assumption is that at this point they just have orders from a judge allowing them to do it and they will find the means later.
Allowing them to do what? The feds are saying they already have the keys, so either they are lying, or they already had the means to get the keys. Which would be the juicy part of the story.
Yes, and the other big questions are how they even know about the existence of the bitcoin and then how they were able to demonstrate sufficient probable cause to a judge that A) the bitcoin belongs to the suspect, and B) this bitcoin is the direct proceeds of the charged crimes. Given the extremely unusual circumstances around this seizure, its unprecedented size and the complete lack of details - I suspect something new and interesting has happened here.
Unfortunately, we may never find out unless they manage to arrest the suspect, which seems unlikely. The more interesting scenario might be if the Prince Group files suit challenging the seizure. In that case, the government would not only have to produce evidence proving A and B above, but also that the evidence wasn't obtained illegally (like from secret NSA wiretaps on domestic Cambodian telecoms or targeted covert hacking). Given the circumstances, it's hard to imagine the FBI being able to offer plausible 'parallel construction' to support the legality of the evidence.
Finding a judge who does not really understand what Bitcoin is won't be too hard. All your "evidence wasn't obtained illegally" and so on are questions impossiblec to ask without a reasonable amount of knowledge. Requirements of a judge order aren't really much of a bar to jump, hardly more than a four eyes formality.
Quite possible they hacked the device they were stored on. I can't find confirmation that Chen has actually been arrested, as opposed to being charged in absentia.
> Those funds (the Defendant Cryptocurrency) are presently in the custody of the U.S. government.
> The defendant and his co-conspirators subsequently used some of the criminal proceeds for luxury travel and entertainment and to make extravagant purchases such as watches, yachts, private jets, vacation homes, high-end collectables, and rare artwork, including a Picasso painting purchased through an auction house in New York City.
My guess some of defendants were in New York or around the US. You can be a criminal master mind and also be a complete f*king idiot.
After having read the thread it's not clear to me where the "3 years" comes from ?
EDIT and were the keys cracked, or were the passphrases obtained ? It's mentioned elsewhere that he had them written down. Which would be a much easier "hack"
Since in pig butchering scams the victims often do not go to the police or tell anyone due to feelings of shame, we can assume quite a big pot of that money will go into the US federal crypto reserve.
Bitcoin market cap is $2.2T, so $15B of that is 0.7% of all bitcoins. They aren't selling them on open market, but in an auction (or a couple of auctions). It may not have an immediate influence on the bitcoin price, unless the buyer sells them right away. When someone sells an amount that big, it's done over a long period of time, to not crash the market (you'd probably get significantly less money if you sold it fast).
> Once they did, however, the marshals fell back on standard procedure, preparing to handle the Bitcoin the same way they would a coke smuggler’s speedboat: by auctioning it off. That posed challenges because of the sheer size of the seizure—about 175,000 Bitcoins, or 2% of all the Bitcoin in circulation at the time. According to a prosecutor familiar with the case, the marshals opted for a staggered series of auctions to avoid crashing Bitcoin’s price. In four auctions between June 2014 and November 2015, the marshals sold the Silk Road Bitcoins for an average price of $379. (https://fortune.com/crypto/2018/02/21/government-forfeiture-...)
There were also some bitcoins seized from a hacker that stole them from Silk Road in 2013, and when they seized it in 2020 it was worth $1B, now it's worth $6.5B. Nice profit for the government. https://fortune.com/crypto/2025/01/09/federal-government-all...
> The practice is called “pig butchering” because scammers deliberately build up trust and emotionally manipulate victims over an extended period—much like fattening up a pig—before ultimately stealing as much money as possible in a final act of financial “slaughter”
And it's a bad expression, because it's the scammers own smug term of contempt, and makes victims less likely to come forward/warn each other thanks to the shame.
The ruling family in Cambodia is a big part of it, via their ownership in HuiOne (now renamed), which is essentially the clearing house for the 'industry'.
In fact the Thai-Cambodia border conflict is due to this industry, and a breakdown in the relationship between Thai and Cambodian leaders over it, with the wiley cambodian leader yet again provoking the sensitive border issue for political gain.
No, it was a "Russia invading Ukraine" sized miscalculation.
The "wily" Cambodian leader's military got their asses handed to them by the Thai army, and Cambodia is suffering a lot more from the still ongoing border closure than Thailand is. Remittances, tourism, trade, you name it, it's all in the doldrums. (Good time to visit Angkor Wat if you can swing it, though.)
I'm living in Thailand and been following scam centers for years now. It's 100% the scam center fallout mixed with regional politics.
Cambodia is fully commited to scam centers and Thailand doesn't like that and even reached out to Xi directly for cooperation here. Not even a year later the conflict broke.
Finally, cambodia is not suffering at all and if anything the current dictator has become significantly stronger and the country has been on a huge nationalist rise as the dictators control the scam centers and easily repurpose them for online propaganda.
Cambodian people are suffering, no doubt about it, but what you say about the surge in nationalism and entrenching his position is certainly true; the 'leadership' has only gotten stronger.
It's surreal how Cambodians are blindly, even passionately, following the government narrative of evil rapacious Thailand invading innocent peace-loving Cambodia, when there is strong evidence showing it was Cambodia provoking the issue to meddle in Thai politics, but there are such deep-seated feelings (on both sides I think) that truth is disregarded.
> Zhi and a network of top executives in the Prince Group are accused of using political influence in multiple countries to protect their criminal enterprise and paid bribes to public officials to avoid actions by law enforcement authorities targeting the scheme, according to prosecutors.
Gentle reminder that the presence of a strong democratic regime with law and no bribes keeps the world a better place.
Once the US becomes corrupted at this scale we are doomed to this bullshit.
Already past that, I'm afraid. With the Presidential cryptocurrency and the lack of investigation into Supreme Court finances, it's going to be grift all the way down.
I'm not sure how you can pull out of it without jailing a significant fraction of the Republican party (and quite a few elderly Democrats). Plenty of people around Trump got jailed and that didn't make a difference.
So in these cases of government seizing bitcoin, the people they seize from have unencrypted private keys?
The article just says "private keys the defendant had in his possession" does this mean he was holding onto private keys that had no passwords / encryption at all that unlocked $15B?
Or does the government have an alternative way of "seizing" bitcoin? I remember years ago people throwing around conspiracy theories that bitcoin was invented by the NSA / other 3 letter agencies with a backdoor to basically allow easy tracking / seizure of criminal assets.
Im not a conspiracy theorist, but stories like these were the government seems so easy to seize such incredibly large amounts of money so easily seems to suggest some other mechanisms that aren't public.
It’s only technically incorrect to suggest that Musk should protest over the recent $15B scam profit seizure—it was from Cambodian scams, whereas the compounds that reportedly had to switch to Starlink due to being disconnected from the Internet are in Myanmar[0]—but yes, it’s still unclear why would Musk not shut any of it down if they have the capability (and if they don’t, then it’s another interesting controversy).
Aha, now this administration can flood the markets with BTC sells leaving $TRUMP as the only true stablecoin!!
I wish this were really just a joke, but I wouldn’t put it past them to raid, hoard, dump, and therefore crash the price of Bitcoin as a strategy to undermine Bitcoin’s position as a stable digital asset for storing value.
Perhaps though it would be just as scurrilous to hoard Bitcoin and not sell it, in an effort to prop up all digital coins as being things of value when they really aren’t?
The only real conclusion I can rely on is it is problematic for one’s government to be run by a tulip bulb salesman while also raiding criminals with tulip bulb warehouses.
Who they were scamming, Americans? How they managed to gain trust, even considering strong accent or grammatical mistakes. How do they identify and trace these Chinese fraudsters? They all look the same and have a name like Hi Lo. Where the money go... of course real estate.
Wow. $15 billion is an astronomical, nearly unfathomable amount of money in Cambodia. This must have been a huge operation. It's almost 1/3 of the country's entire GDP!
Well done DOJ. Hopefully the victims get their money back.
Compared to Cambodia, sure, but it's an international crime gang, with this particular one being just one branch. I wonder if this was their biggest hoard or if they had more?
Really poor financial management to have all that money concentrated that much though. It either means they dropped the ball bigly, or this is spare change for them... although Bitcoin's market cap is $2.24 trillion at the moment, $15 billion is a significant chunk of that.
In $5 wrench we trust. - Bitcoin
That doesn't appear to be how they seized the funds though, the criminal hasn't been caught so they must have hacked his devices to gain access to the private keys. No $5 wrench involved.
Which just goes to show that custody is a hard and almost always under-estimated problem.
> 1/3 of the country's entire GDP
$15 billion is a huge number to be sure, but it's unclear from the article how many years it took to acquire.
So should we praise the gang's money saving habits?
Probably not, but we should probably not compare a total (potentially across years) with something that is measured yearly like GDP, kind of misleading.
No. Just point out as others have that $15 billion vs GDP isn't a likes comparison.
The victims getting their money back would defeat the whole purpose of Bitcoin. No one knows who originally owned it.
How about cash it out and trickle it down to us... or is all that just gonna magically disappear?
Surely it would be possible for victims to come forward and provide a paper trail of WhatsApp transcripts and blockchain transactions.
That's the thing with Bitcoin, all transactions are permanently stored in a public ledger.
Unless the criminals used the Lightning Network of course, not likely though since the amount is so large.
Well you could just reverse all the transactions. But they probably won't do that.
not really? presumably many people transfer via platforms like Coinbase that use a shared wallet system. You can't just "send the money back where it came from" as those wallets might not actually be controlled by the funds owner.
Coin base keeps transaction logs.
Unless this went through a mixer, Bitcoin is quite transparent.
Still easier to just transfer it all to the Treasury of course and screw the victims which is probably what will happen.
Even if the victims get their money back it would only account for 25% or so because the price of BTC has moved so far since they lost it. (I think many victims will successfully petition for their money back)
In theory the court should give them back the actual bitcoin, not the monetary equivalent at the time. In a just world, anyway.
Based on current judicial trends, they’ll probably get Coinbase coupons worth 50% of a different coin or something.
It's part of America's new Strategic Crypto Reserve where Uncle Sam holds bags for crypto bros.
It is definitely going to magically disappear, as in used as funding for ICE.
their business is scam center that by definition is not counted by GDP anyway
That’s not necessarily true, though may be for Cambodia. GDP can include black market activities but countries differ in whether they include specific ones and how.
Does it even count in there though? Fraud isn't a normal transaction. It's the same as theft, which is simply a transfer from one person to another. An act of fraud or theft doesn't represent creation of value the way profit from legitimate transactions do for "black market" goods/services (even if the goods/services are illegal).
Right, it's not black market if you eventually pay some taxes on it somewhere. Dare we call it washed money, and for our American friends in the audience, laundered money.
There are countries that count illegal activities in their GDP estimates.
And should their state sponsored criminal activities count for North Korean GDP for example?
That money would have flowed somewhere, also I'm not sure OP was talking about impacting the GDP just quantizing it. For Cambodia, it's an extraordinary amount of money. Actually for anywhere it's a ridiculous amount of money.
Which makes it worse. A scamming operation that is 1/3 of the GDP is huuuuuuge.
It’s apples to oranges really. You confuse turnover with capital here.
Wait, hold on, I thought the promise of crypto was that:
1. The feds can't take your money.
2. Once your money's gone, it's gone.
If criminals can't count on #1 holding true, and their victims can't count on #2 holding true, what is even the point of it?
Instead of these two take this simple rule: not your key not your money.
There's no thing that the feds can't have because they have an infinite amount of sanctions violence and tools at their disposal to make anyone do what they want, one way or another.
Criminals can’t count on #1 if they hold the keys on them when they get arrested.
>were previously stored in unhosted cryptocurrency wallets whose private keys the defendant had in his possession. Those funds (the Defendant Cryptocurrency) are presently in the custody of the U.S. government.
They used the forbidden technique of 5€ wrench.
It's not even forbidden, anyone can use it.
With the recent insane moves in quantum stocks almost makes me wonder if there’s a possibility the NSA or other USG agency is far enough ahead of publicly known capabilities in quantum computing to brute force private keys/break encryption and this info is leaking into markets.
Of course the more likely explanation is that this was a sophisticated albeit classical hack (infrastructure, social engineering, surveillance, whatever) and the quantum run-up is unrelated retail investor hysteria, but have to consider the possibility the market knows something I don’t. If the government stays far ahead enough of private industry at some point in the coming years (or decades) the USG will break encryption without public disclosure unless quantum resistant algs are put in place before that capability is achieved. Hopefully this more exotic implausibility isn’t the explanation, but entertaining to consider, and history is bizarre enough for it to be true.
I would go with the likely explanation here.
It's 127,271 Bitcoins. Interesting choice not to mention the number of Bitcoins but use its current market value in USD. I feel like this says something about Bitcoin but not sure what exactly.
Edit: Wow, people really don't want to know how many Bitcoins were seized :)
It says Bitcoin is not a standard denomination. Sort of like if you are in France, and Disney bought Discovery, you would want to know the buying price in euros, not US dollars.
This is why crypto could never be considered a currency, even the earliest news about BTC (value, theft, pizza purchases, etc) was always reported in USD values.
But then again, so do big Eve Online battles.
Anecdotally, I would have thrown "127,271 BTC to USD" into Google. I didn't mind it.
This is regular reporting using end-consumer market rates to inflate numbers.
Just as you could not sell 127,271 bitcoins all at once at market value, you could not just sell cocaine worth $1.4 billion but still confiscated drugs, even in large quantities, are reported with end consumer market rates. Nowadays, if a report mentions that is talking about "street value", that is already a big plus in my book.
Long overdue. At some point, these scam operations are so large that they have to be operating with tacit approval of their host countries, who have been given no incentive to stop the virtual cold war against the personal finances of foreign citizenry that is bringing in millions of dollars into their economy.
Direct link to the indictment https://www.justice.gov/usao-edny/pr/chairman-prince-group-i...
Cambodia's specifically 30-50% of the economy can be directly attributed to scamming plus casinos
This one of the other organizations / major bank used for money laundering directly linked to Hun Sen
https://en.wikipedia.org/wiki/Huione_Group
> The company is linked to Cambodia's ruling Hun family, which includes the current prime minister, Hun Manet.[4] His cousin Hun To is a major shareholder and director of Huione Pay
> Cambodia's specifically 30-50% of the economy can be directly attributed to scamming plus casinos
Are you saying that 30-50% of Cambodia's economy can be directly attributed to scamming and casinos? I find that shocking and hard to believe. Do you have a source for that statement?
It's a small / under developed country
the economy is not that big to start with :)
GDP $49.8 Billion (nominal; 2025)
Some examples
https://www.business-humanrights.org/en/latest-news/cambodia...
First off, the amount seized was not necessarily made in a year.
Second, most of the money would not make it to the Cambodian economy. It is likely laundered abroad. The whole operation is likely multinational, with only the workforce located in Cambodia.
It's not hard to believe that a small country can have a vastly oversized economy due to finance - legal or illegal.
An example of a legal one is the UK
Or Ireland with the nominally headquartered multinationals there.
Unsurprisingly the UK was enabling this guy before he got too much heat. From a BBC article:
"The UK government says it has frozen assets owned by his network, including 19 properties in London - one of which is worth nearly £100m ($133m)."
> the UK was enabling this guy before he got too much heat.
How does this quote indicate that the UK was enabling Zhi?
Presumably GP means enabling by not seizing him or his assets earlier? Which I find to be a bit of a stretch.
The amount of bitcoin siezed here is about 30% of the Cambodia GDP...
Presumably they didn’t accumulate it all in one year?
This makes me think of the Barbary Wars where piracy out of the Barbary states was a huge issue. There's also the connection with the slave trade then and the human trafficking for the scam centers now.
https://en.wikipedia.org/wiki/Barbary_Wars
Also North Korea with its state sponsored internet privateering.
> the virtual cold war against the personal finances of foreign citizenry
Comparing a scam to war is inaccurate. The Cold War was a war running cold with the potential to go hot. Cambodia and America are not going to war over this.
Interestingly enough, China is thought to have leaned on the scales in Myanmar’s civil conflict due to pig-butchering there. (Not only were they scamming Chinese, they were also human trafficking them to operate the scams.)
China only began executing those pig-butcherers when the EAO that was providing protection to Chinese pig-butchering gangs in that region of Myanmar (Kachin Independence Army) re-flipped towards India recently [0] and had begun to ignore China [1] and rerouting rare earths and other goods to India [2]
Meanwhile, China never cracked down against similar scams in Cambodia. Most notably, Prince Group remains unsanctioned in China and it's leadership are Mainland Chinese in origin.
While pig butchering (along with opium and human trafficking and other organized crime activities) are a major reason behind Chinese involvement in Myanmar, ignoring the very real proxy war going on between Chinese and Indian interests in Myanmar fails to contextualize some of the decisions that both countries make within Myanmar.
This also explains why you don't see a similar crackdown in Cambodia, which is solidly within the Chinese sphere at this point.
[0] - https://www.stimson.org/2025/rare-earths-and-realpolitik-fut...
[1] - https://www.irrawaddy.com/news/war-against-the-junta/ignorin...
[2] - https://www.reuters.com/world/china/india-explores-rare-eart...
> the EAO that was providing protection to Chinese pig-butchering gangs in that region of Myanmar (Kachin Independence Army)
Kachin is not a relevant location of scam centers. You can find articles that claim otherwise, e.g. https://www.ctol.digital/news/inside-worlds-largest-scam-emp... but from the fact that they mention the Thai border and the city of Myawaddy, which is in Kayin/Karen State, it's clear that they're just confusing Kachin and Kayin.
The Kachin Independence Army seems to finance itself through mining instead.
While it's true that some scammers were recently sentenced to death in China https://www.bbc.com/news/articles/c78nrx309kzo and this only happened after the Kachin Independence Army disrupted the rare-earth trade with China, that's just a temporal coincidence. The scammers were captured in 2023 in Laukkai in northern Shan State near the Chinese border by the MNDAA (an anti-junta armed group dominated by ethnic Chinese) as part of Operation 1027. China is rumored to have assisted the operation in order to crack down on the scam centers in junta-controlled territory. https://en.wikipedia.org/wiki/Operation_1027#Cyber-scamming_... The Kachin Independence Army also participated in Operation 1027, but in Kachin, not Shan.
I don't know about Cambodia.
That's interesting - I had seen some news articles reporting that some Chinese pig butchering scammers were encouraging others to target foreigners only, and exclude the mainland Chinese. Like this one: https://globalinitiative.net/analysis/chinas-acquiescence-to...
It's reminiscent of stories about Russian malware doing nothing on machines with Cyrillic keyboard layouts.
Yep, but notice how that article is about Kokang in Myanmar as well.
Cambodia continues to have scam centers targeting Putonghua speakers (including PRC nationals), but there hasn't been a similar crackdown on such activities due to Chinese pressure.
The crackdown in Kokang happened after China flipped to supporting the Tatmadaw against the Northern Alliance [0] and India began peeling historically India-aligned members of the alliance like the KIA and the Arakan Army back into Indian orbit [1].
P.S. Circa 2 years ago, a large portion of Chinese in SF Chinatown became Kokang and Cambodian Chinese. Bamar, Kuki-Zo, and Kachin Myanmarese primarily reside in Daly City, Ingleside/Outer Mission, and Oakland/East Bay.
SF has a lot of Asian and Latiné subcultures and communities - it's kind of insane how underdocumented it is under the guise of "Asian" and "Latino"
[0] - https://www.stimson.org/2025/too-little-too-late-china-steps...
[1] - https://www.reuters.com/world/asia-pacific/india-extends-unp...
The US is blowing up alleged drug boats and their crews so anything is possible.
that's a pretty naive view of war. we are at war with many countries all the time, most of it is cold.
Maybe we should call it "conflict", and include non-state actors.
Let's go with macro-aggressions and put trigger warnings on them
> we are at war with many countries all the time, most of it is cold
Like whom? We (and let's be honest, every other great power) are at war with many countries all of the time, and while they may be cold for long stretches, they absolutely (a) go hot from time to time and (b) are constantly threatening to go hot.
I this similar concept, differently.
To me "war" is a state of "no rules" hurting. IE nuclear, biological, any weapon goes. Anything less is an exercise in restraint - even if still quite terrible in it's own right.
Which means there are lots of "exercises" of varying lethality, risk profiles, spheres of influence, etc. And yes many countries are jockeying against other countries in varying ways.
Large scale scams against other countries could be seen as an unintended (not a planned government action) exercise that is condoned by the government.
The point of bitcoin was that it can't be taken off you by the state. So either this was severe user error, to the tune of why aren't the keys somewhere secure when there's a billion dollars behind them, or the nominal reason for bitcoin existing is nonsense.
We thinking user error or crypto is nonsense? On the forum I expect the former.
Reminds me of this XKCD: https://xkcd.com/538/
With bitcoin you can't even just rely on memory for the keys, you need something physical that can be taken away from you.
Btw this is low-key the reason why Cambodia almost went to war with Thailand recently. In particular what's interesting is that how quickly Cambodia repurposed scam center employees as internet trolls. They're onto a really powerful golden goose here that not only brings in 15B usd but also empowers the current dictatorship. But also it's a pit of doom that is destined to erupt anytime now.
It boggles my mind that people like this don't set up multi-sig wallets using hardware devices that are physically not in the same location.
I'm curious how the Bitcoin was actually seized, given that the indictment says the perp is still at large and held the Bitcoin in self custodied wallets.
DOJ press release.[1] DOJ claims custody of US$15 billion in Bitcoin. "Largest forfeiture action in the history of the Department of Justice."
[1] https://www.justice.gov/opa/pr/chairman-prince-group-indicte...
I am shocked that the organizer of a large scam call center in SEAsia is a Chinese national.
Large scam call centers run by Chinese nationals are getting broken up in the region pretty regularly.
I see multiple factors here:
- There's a lot of Chinese people in the region (1.3b vs <20M in Cambodia)
- Better access to capital for setting up big operations like this
- Much tighter control and policing in their homeland, so the scammers operate elsewhere
The DOJ article is far more informative than the CNBC article. Chen Zhi, the alleged perpetrator, remains at large.
From this article they got $15B (https://www.cnbc.com/2025/10/14/bitcoin-doj-chen-zhi-pig-but...). At what point do you say, "That's enough money?" Did they think the scam was going to go on forever?
I'm not sure if one can merely walk away from a criminal enterprise of that size. As soon as you stop paying certain people you end up in a cage, and unless the stream of money is constant there is no reason to just not reneg on all prior agreements and go in a cage for stuff you already paid authorities off for.
> As soon as you stop paying certain people you end up in a cage
You end up dead because your co-conspirators don't want to end up in a cage.
So the whole crypto anonymity thing isn’t actually real? As it turns out, tracing people is still easier than tracing money? Decentralized economies are run by criminal enterprises?! We aren’t safe!?!
Wonder how this whole concept overlays onto LLMs, with a lot more money on the line and a lot less regulation.
You're probably joking, but even if crypto was totally anonymous, running a massive criminal human trafficking empire in the real world is very non-anonymous.
Good old police work still works. Because people need to talk to each other to do stuff. The only time anonymity helps is if you can pull it all off solo, and mix the funds enough to not be traced as well as cover tracks well enough.
Crypto anonymity is still possible if you don't plan to spend your ill-gotten millions or billions particularly quickly. But, of course, you don't get to having a massive active criminal empire that way.
At that scale, you have massive influence within the Cambodian government, so you're not worried about "getting caught" in the traditional sense.
These scams have enormous scale. The Economist has a fascinating podcast about it. The full series requires a subscription, but it is worth at least listening to the first 3 free episodes. https://www.economist.com/audio/podcasts/scam-inc
They have shareholders who bought the shares for more than the company annual revenue and expect infinite potential of profits to justify the price they paid
Had they thought $1B was enough they would have missed out on $14B.
I think the implication is they could have stayed under the radar and still have that $1B.
Chances are they still have a lot of the money scammed, just not those particular 15B.
In a way it's like with an overfunded startup: when at some point in time the music stops because even the last would-be investor realized that the business will never be profitable, the company collapses. But all those paychecks received for playing with Other People's Money don't magically return.
Sounds like good news but the press release doesn't detail how the FBI managed to trace, positively identify and then seize such a huge pile of crypto ($15B) from a suspect they say took extensive steps to launder and hide the source and ownership of the crypto. I'm curious because this guy is clearly very experienced, highly sophisticated and located in a country where the government and law enforcement are obviously tacitly protecting him.
So did the U.S. hack this guy? Anyone who manages to build such a massive multi-national corporation with myriad illicit businesses but also dozens of legitimate businesses with thousands of employees - including a large bank with over 100,000 customers - and then operate it all for over a decade, doesn't strike me as someone who's trivially careless. I mean he managed to successfully protect that much money for a long time from his own criminal co-conspirators (who would certainly include hackers with insider knowledge of his operations), criminal competitors and all the people he was bribing like senior Cambodian politicians, law enforcement and intelligence agencies.
This just strikes me as either a very lucky break or a perhaps a sign that the FBI is adopting a new playbook to go after shielded international operations like this. Like maybe involving U.S. and 'Five Eyes' intelligence assets.
"but the press release doesn't detail how the FBI managed to trace, positively identify and then seize such a huge pile of crypto ($15B) from a suspect they say took extensive steps"
Am I slow??? or what under circumstance that you expect FBI to told press how their operate????
I am also curious how the US government obtained possession of the bitcoin if the defendant is still at large. Doesn’t that defeat the whole point of bitcoin?
According to Ars Technica: "Adding further mystery, it’s unknown how federal officials managed to obtain the cryptographic keys required to seize the funds from Zhi."
My assumption is that at this point they just have orders from a judge allowing them to do it and they will find the means later.
Allowing them to do what? The feds are saying they already have the keys, so either they are lying, or they already had the means to get the keys. Which would be the juicy part of the story.
> they already had the means to get the keys.
Yes, and the other big questions are how they even know about the existence of the bitcoin and then how they were able to demonstrate sufficient probable cause to a judge that A) the bitcoin belongs to the suspect, and B) this bitcoin is the direct proceeds of the charged crimes. Given the extremely unusual circumstances around this seizure, its unprecedented size and the complete lack of details - I suspect something new and interesting has happened here.
Unfortunately, we may never find out unless they manage to arrest the suspect, which seems unlikely. The more interesting scenario might be if the Prince Group files suit challenging the seizure. In that case, the government would not only have to produce evidence proving A and B above, but also that the evidence wasn't obtained illegally (like from secret NSA wiretaps on domestic Cambodian telecoms or targeted covert hacking). Given the circumstances, it's hard to imagine the FBI being able to offer plausible 'parallel construction' to support the legality of the evidence.
Finding a judge who does not really understand what Bitcoin is won't be too hard. All your "evidence wasn't obtained illegally" and so on are questions impossiblec to ask without a reasonable amount of knowledge. Requirements of a judge order aren't really much of a bar to jump, hardly more than a four eyes formality.
Quite possible they hacked the device they were stored on. I can't find confirmation that Chen has actually been arrested, as opposed to being charged in absentia.
I guess they have a quantum computer.
According to the indictment:
> Those funds (the Defendant Cryptocurrency) are presently in the custody of the U.S. government.
> The defendant and his co-conspirators subsequently used some of the criminal proceeds for luxury travel and entertainment and to make extravagant purchases such as watches, yachts, private jets, vacation homes, high-end collectables, and rare artwork, including a Picasso painting purchased through an auction house in New York City.
My guess some of defendants were in New York or around the US. You can be a criminal master mind and also be a complete f*king idiot.
Criminal podcast shared the story of one of the forced workers at scamming camp in Myanmar: https://thisiscriminal.com/episode-332-the-compound-9-12-202...
Scam, Inc from The Economist is worth the subscription for 1 month. Very in depth.
https://www.economist.com/audio/podcasts/scam-inc
Is it actually usable, sellable Bitcoin worth $15B? Or is it some kind of storage that the owner couldn't really use easily for some reason?
$15B of real wealth is a large amount even for a powerful family, so I am surprised it's not a headline news in global media.
The forfeiture complaint [1] says:
> Chen personally maintained records of the wallet addresses and seed phrases associated with the private keys for each.
So it sounds like they have the seed phrases and thus the private keys.
[1] https://storage.courtlistener.com/recap/gov.uscourts.nyed.53...
is Chen in custody?
If not, why wouldn't he just transfer the funds to a new seed?
So apparently the FBI or other US agency hacked this guy and drained his wallets? No indication he’s been arrested, wallets said to be unhosted.
Clearly should’ve used an offline wallet lol.
Taylor is on to something here: https://x.com/tayvano_/status/1978273602719158448
tl;dr: Someone cracked these weak entropy wallets 3+ years before anyone else and kept it secret
Whether that was the USG or another entity has yet to be revealed
Please use xcancel: https://xcancel.com/tayvano_/status/1978273602719158448 when linking to X since a lot of us don't have accounts or just don't want to log in.
After having read the thread it's not clear to me where the "3 years" comes from ?
EDIT and were the keys cracked, or were the passphrases obtained ? It's mentioned elsewhere that he had them written down. Which would be a much easier "hack"
Risky move, since it is easy to move the funds to a new address at any time.
It may not be a hack, but a warrant like 'Hey Google, give us access to this guy's Gmail.'
You can’t get a warrant for a bitcoin wallet right?
https://xkcd.com/538/
They did not physically catch the owners apparently.
What happens if it doesn't work?
If it was a last resort and it didn't work, then we wouldn't be in this thread...
You move to the screwdriver
Since in pig butchering scams the victims often do not go to the police or tell anyone due to feelings of shame, we can assume quite a big pot of that money will go into the US federal crypto reserve.
Do they force you to reveal your private keys?
After obtaining the bitcoins, are they forced to sell it immediately? How does this affect the market?
Bitcoin market cap is $2.2T, so $15B of that is 0.7% of all bitcoins. They aren't selling them on open market, but in an auction (or a couple of auctions). It may not have an immediate influence on the bitcoin price, unless the buyer sells them right away. When someone sells an amount that big, it's done over a long period of time, to not crash the market (you'd probably get significantly less money if you sold it fast).
> Once they did, however, the marshals fell back on standard procedure, preparing to handle the Bitcoin the same way they would a coke smuggler’s speedboat: by auctioning it off. That posed challenges because of the sheer size of the seizure—about 175,000 Bitcoins, or 2% of all the Bitcoin in circulation at the time. According to a prosecutor familiar with the case, the marshals opted for a staggered series of auctions to avoid crashing Bitcoin’s price. In four auctions between June 2014 and November 2015, the marshals sold the Silk Road Bitcoins for an average price of $379. (https://fortune.com/crypto/2018/02/21/government-forfeiture-...)
There were also some bitcoins seized from a hacker that stole them from Silk Road in 2013, and when they seized it in 2020 it was worth $1B, now it's worth $6.5B. Nice profit for the government. https://fortune.com/crypto/2025/01/09/federal-government-all...
> Bitcoin market cap is $2.2T, so $15B of that is 0.7% of all bitcoins.
Famously illiquid though.
Through my mind... either they do deals less for prison time. $15bn for some freedom. Or they do something "extrajudicial" with a $5 wrench.
As I understand it, they persuade their marks to transfer bitcoin to accounts they control.
I had never heard of "pig butchering".
> The practice is called “pig butchering” because scammers deliberately build up trust and emotionally manipulate victims over an extended period—much like fattening up a pig—before ultimately stealing as much money as possible in a final act of financial “slaughter”
I can highly recommend a recent series of podcasts by The Economist on precisely this topic https://www.economist.com/podcasts/2025/02/06/1-pigs-in-a-ba...
It's a huge deal in China, though Europeans are starting to get targeted as well.
It's a direct translation of the Chinese 杀猪.
https://en.wikipedia.org/wiki/Pig_butchering_scam
And it's a bad expression, because it's the scammers own smug term of contempt, and makes victims less likely to come forward/warn each other thanks to the shame.
And this isn't the only one.
The ruling family in Cambodia is a big part of it, via their ownership in HuiOne (now renamed), which is essentially the clearing house for the 'industry'.
In fact the Thai-Cambodia border conflict is due to this industry, and a breakdown in the relationship between Thai and Cambodian leaders over it, with the wiley cambodian leader yet again provoking the sensitive border issue for political gain.
No, it was a "Russia invading Ukraine" sized miscalculation. The "wily" Cambodian leader's military got their asses handed to them by the Thai army, and Cambodia is suffering a lot more from the still ongoing border closure than Thailand is. Remittances, tourism, trade, you name it, it's all in the doldrums. (Good time to visit Angkor Wat if you can swing it, though.)
I'm living in Thailand and been following scam centers for years now. It's 100% the scam center fallout mixed with regional politics.
Cambodia is fully commited to scam centers and Thailand doesn't like that and even reached out to Xi directly for cooperation here. Not even a year later the conflict broke.
Finally, cambodia is not suffering at all and if anything the current dictator has become significantly stronger and the country has been on a huge nationalist rise as the dictators control the scam centers and easily repurpose them for online propaganda.
Cambodian people are suffering, no doubt about it, but what you say about the surge in nationalism and entrenching his position is certainly true; the 'leadership' has only gotten stronger.
It's surreal how Cambodians are blindly, even passionately, following the government narrative of evil rapacious Thailand invading innocent peace-loving Cambodia, when there is strong evidence showing it was Cambodia provoking the issue to meddle in Thai politics, but there are such deep-seated feelings (on both sides I think) that truth is disregarded.
Glad they got somewhere with that. It's a bit shocking some of the stuff that goes on out there.
> Zhi and a network of top executives in the Prince Group are accused of using political influence in multiple countries to protect their criminal enterprise and paid bribes to public officials to avoid actions by law enforcement authorities targeting the scheme, according to prosecutors.
Gentle reminder that the presence of a strong democratic regime with law and no bribes keeps the world a better place.
Once the US becomes corrupted at this scale we are doomed to this bullshit.
Already past that, I'm afraid. With the Presidential cryptocurrency and the lack of investigation into Supreme Court finances, it's going to be grift all the way down.
I'm not sure how you can pull out of it without jailing a significant fraction of the Republican party (and quite a few elderly Democrats). Plenty of people around Trump got jailed and that didn't make a difference.
wonder what they’ll spend it on
So in these cases of government seizing bitcoin, the people they seize from have unencrypted private keys?
The article just says "private keys the defendant had in his possession" does this mean he was holding onto private keys that had no passwords / encryption at all that unlocked $15B?
Or does the government have an alternative way of "seizing" bitcoin? I remember years ago people throwing around conspiracy theories that bitcoin was invented by the NSA / other 3 letter agencies with a backdoor to basically allow easy tracking / seizure of criminal assets.
Im not a conspiracy theorist, but stories like these were the government seems so easy to seize such incredibly large amounts of money so easily seems to suggest some other mechanisms that aren't public.
The forfeiture complaint [1] says:
> Chen personally maintained records of the wallet addresses and seed phrases associated with the private keys for each.
So he wrote the passwords down, basically.
[1] https://storage.courtlistener.com/recap/gov.uscourts.nyed.53...
Where did he write the passwords that the us govt. seized them exactly?
Would these money be returned to the victims?
Unfortunately, in pig butchering scams the victims often feel ashamed and wouldn't claim their stake.
lmao
Why would the government bother prosecuting/seizing it if the money was going to the victims?
That’s how it’s supposed to work. But these days who knows.
Um maybe because the government isn't supposed to work for profit but to enforce the law and do the right thing for victims and society?
If they're going to be only prosecuting crimes where there's something in it for them it's going to be a very unsafe society.
What about good old asset forfeiture to buy more swat toys?
“Home Depot™ Presents the Police!®"
https://www.newyorker.com/humor/daily-shouts/l-p-d-libertari...
Wonder if Musk will be protesting, those seizures could put a dent in SpaceX earnings https://www.barrons.com/news/myanmar-scam-cities-booming-des...
It’s only technically incorrect to suggest that Musk should protest over the recent $15B scam profit seizure—it was from Cambodian scams, whereas the compounds that reportedly had to switch to Starlink due to being disconnected from the Internet are in Myanmar[0]—but yes, it’s still unclear why would Musk not shut any of it down if they have the capability (and if they don’t, then it’s another interesting controversy).
[0] https://www.lawfaremedia.org/article/starlink--an-internet-l...
Related:
U.S. Sanctions Cambodian Conglomerate, Citing Role in 'Pig-Butchering' Scams
https://news.ycombinator.com/item?id=45584418
Thanks, we'll merge that thread hither
Aha, now this administration can flood the markets with BTC sells leaving $TRUMP as the only true stablecoin!!
I wish this were really just a joke, but I wouldn’t put it past them to raid, hoard, dump, and therefore crash the price of Bitcoin as a strategy to undermine Bitcoin’s position as a stable digital asset for storing value.
Perhaps though it would be just as scurrilous to hoard Bitcoin and not sell it, in an effort to prop up all digital coins as being things of value when they really aren’t?
The only real conclusion I can rely on is it is problematic for one’s government to be run by a tulip bulb salesman while also raiding criminals with tulip bulb warehouses.
When BTC goes down, altcoins typically also go down, so it would have a negative effect on $TRUMP.
Who they were scamming, Americans? How they managed to gain trust, even considering strong accent or grammatical mistakes. How do they identify and trace these Chinese fraudsters? They all look the same and have a name like Hi Lo. Where the money go... of course real estate.
this should answer some of your questions: https://youtu.be/vu-Y1h9rTUs