Georgia man pleads guilty to stealing $3.4 billion worth of bitcoin
A real estate developer has pleaded guilty to stealing over 50,000 bitcoins from the dark web marketplace Silk Road about a decade ago.
On Monday, Southern District of New York revealed in a statement that the Justice Department recovered $3.4 billion of the cryptocurrency last year from the alleged perpetrator, identified as James Zhong.
Court documents revealed that Zhong, 32, pleaded guilty on Friday to committing wire fraud in September 2012 after illegally obtaining the digital currency. At the time, a single bitcoin was worth about $13.50.
Federal agents found bitcoin on devices hidden in an underground safe at Zhong’s residence in Gainesville, Georgia, during a raid last November when the cryptocurrency was worth $68,000 a coin. The digital money was allegedly stored on a single desktop computer hidden inside a popcorn box and hidden under blankets inside a bathroom cabinet.
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The recovered crypto is reportedly the second largest seized by the government $3.6 billion recovered in February from a pair who allegedly hacked virtual currency exchange Bitfinex in 2016.
Damian Williams, the US attorney for the Southern District of New York, attributed the operation’s success to “state-of-the-art cryptocurrency tracking and good old-fashioned police work, law enforcement.”
“For nearly ten years, the whereabouts of this huge chunk of missing bitcoin had turned into a $3.3 billion-plus mystery,” Williams said.
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Zhong, who now faces a 20-year prison sentence, allegedly used nine anonymous accounts to trigger high-speed transactions on Silk Road to trick the withdrawal processing system into transferring bitcoin to his accounts.
Speaking for Zhonglawyer Michael Bachner said Zhong is “extremely remorseful for his conduct that occurred over 10 years ago when he was only 22 years old.”
“Given the increase in bitcoin value over the past decade, the value of the bitcoin he returned exponentially exceeded the value of the bitcoin he took,” Bachner said.
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Featured image via Michael Wuensch
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