China Accuses U.S. of Seizing $13B in Bitcoin, Tension Between Nations Escalates

A massive Bitcoin mystery from 2020 has resurfaced, but this time, it’s not just about hackers and stolen crypto. China is accusing the United States of secretly taking control of 127,000 stolen Bitcoins, worth around $13 billion, in what may become one of the most controversial crypto disputes ever. The allegation has added fresh strain to the already tense relationship between the world’s two biggest powers.

China Claims U.S. Involved in a Major Crypto Hack

According to China’s cybersecurity authority, the National Computer Virus Emergency Response Center (CVERC), the Bitcoin in question was stolen back in 2020, during a hack targeting the LuBian mining pool, a Chinese-based crypto mining operation.

CVERC says the attack was sophisticated and used advanced hacking tools, the kind that only “a state-level hacking organization” could manage. Chinese state media suggests that the same group that hacked the Bitcoin may be linked to the U.S. government.

China claims that rather than returning the Bitcoin or acknowledging the hack, U.S. officials seized the funds as part of an undercover operation.

U.S. Rejects the Accusations

The U.S. government strongly disputes China’s claims. According to U.S. officials, the Bitcoin was seized legally as criminal evidence as part of a law enforcement case involving Chen Zhi, a Cambodian business figure accused of running crypto-related fraud. American agencies argue that Bitcoin was part of a money laundering and fraud investigation, and insist there was no hacking involved by the U.S.

Wallet Movements Spark Suspicion

For almost four years after the hack, the stolen Bitcoin sat untouched. Then suddenly, in mid-2024, the coins began moving. Blockchain analytics firm Arkham Intelligence later labeled the new wallet addresses as belonging to the U.S. government. This is where China challenges the U.S. explanation.

CVERC claims the timing and movement of funds do not match a normal law enforcement seizure. Instead, they believe these movements suggest that the U.S. may have controlled Bitcoin earlier than admitted, possibly playing a direct role in the original hacking operation.

Moreover, the accusation comes at a time of rising friction between the U.S. and China over technology, trade, and cybersecurity. To China, this case is more than just crypto; it’s about digital power and control. To the U.S., this is a legal seizure of stolen crypto tied to crime.

Crypto Reaction

Crypto influencers are reacting sharply to the China–U.S. bitcoin dispute, warning that the stakes have now escalated from just a hack to a geopolitical battle. According to Money Ape, the involvement of $13 billion worth of bitcoin is massive and could shake market stability. Another crypto influencer adds that China’s accusations of the U.S. highlight the real political risk surrounding Bitcoin. With 127K BTC possibly moving under government control, he warns that this could trigger sudden volatility and impact overall market liquidity and sentiment. 

Both stress that traders need to stay alert. This situation could create huge opportunities, but only for those who stay level-headed instead of panicking.

FAQs

The dispute involves 127,000 Bitcoins worth approximately $13 billion. These coins were allegedly stolen from a Chinese mining pool in 2020 and remained dormant until movements were detected in 2024.

China claims the U.S. used sophisticated state-level hacking tools to steal Bitcoin from the LuBian mining pool in 2020, then secretly seized the funds instead of returning them or acknowledging involvement in the operation.

The U.S. maintains the Bitcoin was legally seized as criminal evidence in a law enforcement investigation involving fraud and money laundering, specifically related to a Cambodian businessman named Chen Zhi.

The Bitcoin sat untouched for nearly four years after the 2020 hack, then suddenly moved in mid-2024. China questions this timing, suggesting it indicates U.S. control earlier than officially acknowledged, contradicting the legal seizure narrative.