In brief

  • Chinese authorities have seized over $4 billion in crypto assets.
  • The funds were part of a major Ponzi scheme that exploited over two million people.
  • To date, 15 people have been convicted.

Chinese police have seized a total of 194,774 Bitcoin—a total 1% of the Bitcoin total supply—over the PlusToken Ponzi scheme, as reported by The Block. 

In addition, they have also seized over 830,000 ETH, 1.4 million LTC, 27 million EOS, 74,000 DASH, 487 million XRP, 6 billion DOGE, 79,000 BCH, and 213,000 USDT.

The PlusToken Ponzi scheme, which was first ruled on by a district court in China's Jiangsu province this September, reportedly began in May 2018. The scheme advertised a non-existent crypto trading platform, and promised users attractive payouts in exchange for deposits of at least $500 worth of crypto assets. The scheme raked not only raked in 1% of the total Bitcoin supply, but 0.73% of total ETH, and 5% of all DODGE in circulation, too. 

The scheme had proven to be immensely lucrative, even during the lowest downturn in crypto prices. Between May 1, 2018, and June 27, 2019, these assets were reported to be worth $2.2 billion. Now, they are worth over $11 billion. 

What’s more, the scheme is said to have exploited over two million people. 

To date, a total of 15 people have been convicted. The sentences issued by the Chinese court range from two to 11 years in prison, with fines ranging between $100,000 to $1 million. One of these individuals had reportedly already successfully laundered $22 million worth of cryptocurrency into Chinese yuan. 

The full judgement also said that “the seized digital currencies will be processed pursuant to laws and the proceeds and gains will be forfeited to the national treasury.” 

So not only does China control half of Bitcoin’s hash rate—it is now a big holder too.

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