China seeks to confiscate 61,800 BTC from $5.7B fraud

Chinese prosecutors are seeking to confiscate more than 61,800 bitcoin, along with other crypto, cash and valuables, tied to a fraud that raised over 40 billion yuan (roughly $5.7 billion) from more than 102,000 investors, CoinDesk reported on Thursday, citing Chinese outlet The Paper. The move lands days after a London court ruled that Chinese law should decide victims' claims to the same coins.

What prosecutors allege

The case centres on Qian Zhimin, described as the controller of Tianjin Lantian Gree Electronic Technology. According to prosecutors:

• From 2014 to 2017 the company sold unlicensed wealth-management products across China, promising guaranteed principal and high returns.
• It raised more than 40.378 billion yuan from over 102,000 investors, who were left with losses of nearly 20 billion yuan.
• Instead of funding real businesses, the money was used to pay earlier investors, run fake projects and buy bitcoin, property, cars and jewellery.

Qian left China in 2017 and later settled in the UK, where authorities seized the assets, including the bitcoin plus smaller amounts of bitcoin cash, bitcoin gold, bitcoin SV, XRP and dogecoin.

The court process in China

On Oct. 13, the Tianjin No. 2 Intermediate People's Court said it had accepted the prosecutors' request to treat the assets as illegal gains. It opened a six-month period during which victims and other interested parties can join the case. Victims who stay out can still seek refunds from whatever is recovered.

Two countries, one stash

The coins sit in Britain. As we reported, the High Court in London ruled that alleged victims' claims must be assessed under Chinese law. That does not shut victims out; it means each claim will be tested against Chinese property rules at further hearings, and lawyers for some victims are seeking to appeal. How the UK handles a Chinese confiscation order on top of its own proceedings is the open question.

It is one of the largest alleged crypto-linked frauds in China, and the stash is worth far more now than when it was seized. Promises of "guaranteed" high returns remain the classic red flag; our guide to spotting crypto scams covers the warning signs, and how to store crypto safely explains why custody matters when things go wrong.