By John Hugh DeMastri Daily Caller News Foundation The Department of Justice (DOJ) seized over $3.36 billion in the form of the cryptocurrency bitcoin last year over fraud conducted on the so-called “dark web,” the DOJ announced Monday. James Zhong stole 50,000 bitcoins from a dark web site known as the Silk Road Marketplace, which…
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By John Hugh DeMastri
Daily Caller News Foundation
The Department of Justice (DOJ) seized over $3.36 billion in the form of the cryptocurrency bitcoin last year over fraud conducted on the so-called “dark web,” the DOJ announced Monday.
James Zhong stole 50,000 bitcoins from a dark web site known as the Silk Road Marketplace, which operated from 2011 to 2013 and gained infamy due to its use by drug dealers and other illicit actors, according to the DOJ. Zhong pleaded guilty to wire fraud on Nov. 4, 2022, and the government’s Nov. 9, 2021 seizure of his stolen bitcoin represents the largest cryptocurrency grab by the agency in terms of dollar value, and its second largest financial seizure of all time.
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“Mr. Zhong executed a sophisticated scheme designed to steal bitcoin from the notorious Silk Road Marketplace,” said Tyler Hatcher, the Special Agent in Charge of the Internal Revenue Service, Criminal Investigation, Los Angeles Field Office, according to the DOJ. “Once he was successful in his heist, he attempted to hide his spoils through a series of complex transactions which he hoped would be enhanced as he hid behind the mystery of the ‘darknet.’”
In Nov. 2020, the DOJ seized 69,000 bitcoins, at the time valued at over $1 billion, from a hacker the agency identified only as “Individual X,” according to the U.S. Attorney’s Office of the Northern District of California. The cryptocurrency was stolen from the creator of Silk Road Ross Ulbricht, who was convicted in 2015 of money laundering and drug dealing and sentenced to life in prison, The Wall Street Journal reported at the time.
Fed announce $3.36 billion seizure of bitcoin which was stolen from the Silk Road, and represents the second-largest recovery of crypto.
— unusual_whales (@unusual_whales) November 7, 2022
The DOJ declined to comment beyond the press release.
This story originally was published by the Daily Caller News Foundation.
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