Bitcoin Forum

Chinese Police Seize 1% of Bitcoin’s Total Supply
https://decrypt.co/49735/chinese-police-seize-1-of-bitcoins-total-supply
Scott Chipolina(C)

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.


https://twitter.com/lawmaster/status/1332252655603822593

"This is massive news. The amounts seized by the Chinese police:

- 194,775 BTC (1% of circulating supply)
- 833,083 ETH (0.73% of circulating supply)
- 1.4 million LTC
- 27.6 million EOS
- 74,167 DASH
- 487 million XRP
- 6 billion DOGE
- 79,581 BCH
- 213,724 USDT

The court said "the seized digital currencies will be processed pursuant to laws and the proceeds and gains will be forfeited to the national treasury." Still not 100% clear what that means"

Good news, isn't it?

Can't really be bothered to go check veracity, but decrypt's generally got quite solid reporting. Can't imagine what the CCP is going to do with this. I know they don't actually organise police bids typically for confiscated goods but I'd love to be a fly on the wall seeing that operation go down.

Seriously, the number of people investing in Ponzis is too damn high.

P.S. If you want a clue on which currencies actually have utility, this is a pretty ok list to go by haha. Dogecoin still preferred to than most alts that's a laugh!

How on earth it can be a good news?? Having 4 billion USD worth of crypto assets in the hand of an authoritarian government!! It's good that a ponzi scheme is busted but Chinese government is not at all favorable to cryptocurrencies.

I don't know what Chinese law says, but in general for any such kind of financial frauds, the government liquidate the seized assets and return the money to its investors. That liquidation happens in fiat currency so I assume Chinese government will sell off the seized crypto assets. That's not a good news in this bleeding market!

It will be all used for the glory and the happiness of all the nation, reminds me of that scene (https://youtu.be/A-6Qj3n_NtA?t=120) from Chernobyl. But it will be interesting to see how will they exchange them for yuans, wiouht breaking their own laws.  ;D

But again, we see another proof that some scammers are idiots:


Seriously you're living in a country where the party wants to know and has the means of knowing if you have brushed your teeth properly before getting on a bus and you think you can come out of nowhere and start spending without getting caught?


I started to appreciate that coin, no drama behind the founders, no premine, fast and cheap to use, accepted on almost all exchanges, even a few ATMs, a proof that simple things are what's needed, no fancy dapps and contracts and during cancer and all that other advertised crap.

There's no way in hell this coinage will ever reach an open market. Just like every other seizure in every other country they'll be auctioned or a private sale arranged. It's a more positive outcome for everyone than its previous state of affairs.

It's better than it remaining in the hands of the people who stole it. They were dumping constantly, and they deserved nailing to the wall.

Why such news were released at the right period when Bitcoin were not able to break its cap at $20k? Multiple bad news were released after that moment.

More than that, I stopped reading the article on the blockcrypto (https://www.theblockcrypto.com/post/85873/china-seize-billion-cryptos-from-plustoken-crackdown) when I saw "Ponzi scheme crackdown". Scammers are everywhere and they try to abuse any tool they can (crypto is only of tool they try) and they do neither contribute anything to crypto market nor destroy the crypto market exclusively bitcoin.

Such bad news from China can be expected if we knew what happened recently with OTC markets on OKEx. Additionally, some links in that article direct to a local newspaper and I don't believe in their validity.

Correction can be deeper but it is a healthy correction and such news don't break my belief in bitcoin.

Whoa, how did they do it? Will this affect the price of bitcoin?

Not likely.  The Chinese central bank is aware of the consequence of dealing with fall out of USD collapse, and is quietly boosting its precious metal and crypto currency holdings for the day of global reset.

I thought the understanding was that this kind of news would lead to an increase in the price of Bitcoin?

It usually induces short term panic from certain nincompoops who believe the Chinese government will create an account on Yobit and spend 8 months tapping the dump key. Then the coins find some buyers off market and we never hear about it ever again.

IMO, it can be considered as good news knowing that the Chinese government is also after people who do Ponzi scheme with cryptocurrency that shows fair and just in implementing their law over the citizens and to the culprits of the society.

However, when the seized assets amounting to $4 billion of cryptocurrency with 1% of Bitcoin circulating supply in the market will be forfeited and go to the national treasury that may cause either a lesser supply of bitcoin which will pump the Bitcoin's price or if they will sell it by having an auction then Bitcoins value may dump.  The worst effect of this news could lead people not to trust Bitcoin or other cryptocurrencies that might hinder the global adoption and become odd in hitting the ATH.

If they are really going to sell what they have seized, it will be a little strange that they have to do so in a country where crypto trading is banned - but I believe they have left themselves such a possibility somewhere in the law - and even if they are not, whom will they answer to because they have broken the law? They may be haunted by the spirit of the great leader Mao Zedong  ;)

Speaking of China, nothing good when it comes to crypto does not come from that country, so we continue in the same tone.

I don't know if this is good news or not.  

Another question arises - are the Chinese authorities planning to sell these bitcoins or not?  Will Bitcoin Become a Strategic Resource for Governments in the Next Decade (2021-2030)?  Will Bitcoin become the world's reserve currency?  It is difficult for people to own bitcoin if governments actively discourage it.  

However, for states, this asset can be very attractive.  Perhaps China wants to own not 1 percent of all bitcoins, but 10 %?  60 %? Perhaps other states are interested in having the first cryptocurrency in their reserves.  
As far as I know, Iran has stated this need.

https://news.bitcoin.com/iran-bitcoin-sanctions-inflation/

1% of the total Bitcoin supply is really a big amount. I can't believe that, is there any other source of that news? It's quite complicated to determine if it's positive for Bitcoin. But I have to admit, it's good for whole crypto communities. It's because at least a big Ponzi scammer's fund has been seized by police. If it's true, means that fund is under the control of governments. If happen a massive sell then it would be a negative impact on Bitcoin price. Who knows, if the current dump of Bitcoin happened due to this news?

It should not effect the price of bitcoin, i don't think this can create any panic in the market. The Chinese police seize the bitcoin and if they never sold them, the bitcoin total supply can decrease further resulting in more high bitcoin prices.

Not necessarily. Most of the times, such trades take place on OTC and they are unlikely to affect the market in general. Govt will never register an account with an exchange to sell the seized BTC. FBI has auctioned BTC acquired from Silk Road issue if I'm correct.

According to the statement in OP, it clearly says that they will liquidate the crypto and the gain will be sent to treasury.

It’s still alarming that people up to this day are still into ponzi schemes and are still blindly sending their money over to these organizers. We have seen the fall of bitconnect and other such “companies” over the course of a few years, but apparently people never learn, so long as there’s immediate money to be made. One area of questioning though would be the cryptocurrencies’ fate on the hands of the Chinese government. That’s a lot of money, and could be used for virtually anything that they can think of.

There's no reason for them to do anything other than every other authority - sell it to the highest bidder. I certainly hope the victims of the scheme get the proceeds.

Schemes like this will always happen. Untold numbers of people are stupid and desperate and will be as long as there are still people. They can talk themselves into believing anything if they have a hope of solving problems or making a gain.

That's surely a lot, but I think it's better if China has this money than the scammers. It's good when scammers are finally caught and the money is taken from them, but I think it would be fair to return this money to the scam victims, and I believe this doesn't usually happen (with cryptos) in these situations. In any case, 1% is not big enough to control or significantly impact Bitcoin, and perhaps the government will make an auction or sell these coins on exchanges to show that they are not BTC hodlers. As for the market, I think the price is still very good, so what if it's not $19k anymore.

incredibly, it's amazing how the Chinese authorities quickly seized a sizeable supply of crypto.
This obviously has a big impact on other big investors in China.
Of course, evidence of confiscation in addition to entering the state treasury will also add to quite a worrying crypto change.

If there is any indication of abuse, I think a lot of people will worry that crypto ownership in China will be limited.

Sometimes it happens like when things are confiscated, they are destroyed also. How will they act? Selling bitcoins on auction? Will they sell the whole supply alone? According to rules, they should sell the whole and not parts if I amn't mistaken and if that's true, then I think it will be hard or almost impossible to find the buyer. Btw, right now PayPal may buy the whole supply in good price, it would be double win for them but my thinking is just a supposition.

Btw imagine guys those 1% of coins were "burned'. What will happen to the price? Logically, it should significantly rise because right now there is a high demand but supply decreases by 1%.

PlusToken was a very well known ponzi scheme in China and South Korea, millions lost thier life savings so I am not surprised that seized amount is in billions of dollars. Numbers reported (194,774 BTC, 833,083 ETH etc...) are similar to those from article released back in July 2020 when prosecution of those involved started, so I guess this latest news is legit.



And then people ask " are these scammers stupid, no one will fall for this 10% daily ROI scheme". People were falling for similar schemes before cryptocurrencies appeared, and all this made it just easier for scammers as people heard about others getting rich by investing in BTC so naturally they want piece of cake too. For many BTC is some kind of magic money.


They are not stupid, they will want to profit from this. If they really want hurt cryptocurrencies, they could do it anyway even without those seized funds. As others said, at least scammers won't be able to dump it.

Indeed this is both good news and could also be bad news for if the Chinese government will sell all the seized Bitcoins that is almost 1% of the total bitcoin in circulation then I must agree that it will give a huge impact on the bitcoin's price especially that we are currently experiencing price shake and it will be possible that we may not hit the ATH within this year.

I must commend the Chinese government for they are able to execute their law and put it into action as these gigantic scammers fall behind to their authority and must be done globally for a lot of culprits are still at large and often cryptocurrencies are the target for there are a lot of people who are newbies in this field and can be easily fooled by such felon.

I think on a bigger scale it's not such big news. Yes, if China dumped those coins tomorrow on public exchanges, the price would take a deep dive, but years from now, it would be pretty irrelevant, even this worst-case scenario. I think any news about regulations or adoption are much more important, even if they seem smaller, because they can influence Bitcoin for years.

This is really great news!!!

PlusToken scam was one of the largest such acts we ever had in the recorded history of cryptocurrency. There are estimates that close to 3 million people were scammed by the PlusToken promoters, with up to $10 billion stolen. I have to appreciate the Chinese officials in arresting the suspects and seizing the stolen money. I hope this would discourage similar scams in the future.

From the article, it seems to me that the seized funds will be attached to the state treasury. So is there a chance of the victims getting any reimbursement for their losses?

And also, will the Europol ever manage to do what the Chinese did regarding PlusToken? Onecoin scam also resulted in huge losses for many users. And the last time I heard, the mastermind (Ruja Ignatova) is still roaming around freely in Germany.

I am happy that a ponzi scam got busted and the Chinese police did a good job here. But the thing I don’t like that, this news released when bitcoin was pumping. As they seized 1% of bitcoin, it really affected the market and the market crashed.

And another thing is if Chinese government release those funds on exchangers it will be a huge dump on the market. Because the amount is huge and it can be happen anytime.

Here I am starting to worry about institutions starting to HODL a large percentage of Bitcoins, large enough to censor us, and everyone in the topic is celebrating the fact that China HODLs 1% of the supply.

It's not like it's a super bad thing that would do a permanently damage to Bitcoin though. Yes there's going to be a huge dump but it's not like Bitcoin won't recover from that. Bitcoin has been tested many times and it won't go down easily just from that. Anyway, I doubt there's going to be dumping anytime soon. It's probably going to get hold for a very long time.

Considering that they hold 1%, that does not seem a lot but I think if you have that much then you might have the ability to influence the market. The scary thing about this is that China is proactive when it comes to acquiring bitcoin, this might be the tip of the iceberg.

This is similar to what the FBI did after seizing Bitcoins from the Silk Road dark market. In all probability, they will auction these coins. Imagine this - the Chinese governments auctioning cryptocurrency using their own platform, when trading of cryptocurrency (vs fiat) is banned in China. That would give rise to some uncomfortable questions to the authorities. They need to circumvent the very laws that were set by them.

Of course it's good news. The scheme is stopped and the funds aren't going to the scammers anymore.

I guess this implies that the government control 1% of the Bitcoin's total supply. But remember, the amount that they potentially seized is just a tiny fraction of their GDP. It is honestly just pocket change for them and they're probably going to just auction it off or hold onto it, which is great no matter how you look at it.

It is really a great news because finally the scammers got busted by the law enforcers, the number of scammers are continuing to increase as the time passing by and it is so sad that there are a lot of people are continuing to get scammed but for me it is their fault because they let other people to fool them. I'm just thinking if in what way the police officers of the China will use the cryptocurrencies that they seized in their past operations. For me there is a high chanve that they can use it to increase their yearly budget.

It is bad news. The only thing that is good is that a big group of ponzi scammers got caught.

It's very unlikely they will hold auctions and allow their citizens and Chinese investors to buy the seized coins. The coins will get liquidated, exchanged for yuans (fiat), and placed in the national treasury. This will lower the supply of bitcoin and the value will drop a bit. But I don't think it will have a significant impact on the price.

Then have a large percentage enough held by the custodians, and > 50% of users' transactions through them, I believe Bitcoin as a censorship-resistant cryptocurrency has failed. What use then will POW be?

Yes its good news for the price because those 1% from circulating supply will be frosen because the chinese goverment is not fond of bitcoin as we know there is a big demand on bitcoin and with circulating supply decreasing the price will go up or maybe they will use it as leverage because the us goverment has a  big supply of bitcoin too.

https://www.google.com/amp/s/www.cnbc.com/amp/2013/10/03/what-do-the-fbi-do-with-3-million-bitcoins.html

Funny, I was thinking of the same. China isn't quite like that, but yeah, still interesting to see what they'll do, if we'll ever be allowed to find out;)


It really does seem that people who have a lot of money have really poor judgments. I seriously hope I don't suddenly become stupid overnight if Bitcoin goes to $1 million!


Precisely. You don't need to be a fancy token economics professor from Ivy League, don't need suits and ties to back up your claims. Don't need to save the world with your vision of decentralization.

Get the community on board, get your message straight, do what you're supposed to do, it takes off and lives on.

This money is quite large, I can consider it as good news if the Chinese police will return the money to over two million people who originally owned it because if this amount will be dump then it will surely affect the market for sure.

National treasury means they will surely convert the crypto into their local fiats if I am not mistaken, I will just hope that it will not create a big impact to the crypto market especially that we are still in the process of triggering the bull season.

Good news for discovering the fraudulent Ponzi scheme and returning assets to people who have been deceived, but I do not know how this will reflect on the market that is already suffering these days, no one knows how the Chinese government will act with these assets, but it is possible to return them to their owners and thus will be pumped again To the cryptocurrency market, of course, pumping this large amount to the market in one go could lead to an increase in the supply of these currencies and a decrease in their prices.

There was another news like that with 200 000 BTC confiscated from the police (https://bitcointalk.org/index.php?topic=2566430) a few years ago, but nothing came out of it. We never heard anything anymore about those coins, and that was a massive one too. I guess this is what is going to happen again, and speaking of China, we wont hear about those coins at all.
It won't change the market as they won't sell the coins on the public exchanges. Someone with a lot of money will get himself some a cheap coins and the Communist's Party will be happy.

I guess that news was from 2017. Some of the countries don't want to reveal details about the seized assets and this is not just applicable to cryptocurrency. There is another chance that the information is being withheld, as the investigation is ongoing. Anyway, I would assume that the Bulgarian authorities are still holding most of these coins. Things move very slowly in these ex-Communist nations. It may take another decade for them to decide what to do with these seized assets.

BTC are not moving slowly here in china.
Quite the contrary. 

Those of us in the know Plenty of cross strait trades; both private individual and institutions closing shops repatriate can attest to this.

I don't have idea how they secured the seize currency. I mean if it's related to crypto currency they need to have the keys for it the question is who will hold that keys ? Is it possible that they transfer it to a new wallet after getting it to the owner and there are only limited person knows about the keys . What if the one trusted the keys transfer the balance to another wallet and say it it's hacked ?

The lack of transparency makes possible only to speculate.
If chinese government put the bitcoins on the market for sell then I think it's good news, but if they are holding that is very bad news. We are talking about one scheme caught by chinese police, but imagine how many of them are still operating in China and how many others heve been already caught as well.

Adding all these sums how much of bitcoin supply has already passed through chinese government hands? Probably a lot. And if they aren't really selling these bitcoins the situation becomes even more serious.

What happen to you if the communist government catch you dealing with bitcoin?

All this money was seized from the PlusToken ponzi scheme.

^ At least make this part clear so we know where all that cryptocurrency came from.

My gut feeling is that China will send it all to its own treasuries to use them as government money. It's a lot of money, so why would you think they'd throw away the opportunity to advance their own Digital Yuan project and use this as funding.

Actually I am happy to know that the ponzi scheme crime in China has been successfully stopped, and the Chinese police were able
to confiscate about $ 4 billion in crypto assets. That's a very large number, on the other hand this could have a negative impact if the
Chinese police will sell all the confiscated crypto assets. Hopefully this will not happen, because it can create a market dump.

But I was quite surprised to learn that the ponzi scheme that occurred in China could be as much as $ 4 billion. This proves that there are
still many people who invest without doing research first, I hope the ponzi scheme that is happening in China will be a lesson for all of us,
to be more careful in choosing projects for investment.

I guess they will deal with the seized assets the same way as the FBI dealt with the Silk Road coins. FBI created a new wallet, and moved the coins to this wallet. Only the FBI staff has the private keys to access these coins. The coins were held in this wallet for sometime, before the FBI got rid of them through a series of online auctions. I am not sure whether they have any coins remaining from that seizure.

People should stop to give too much attention to all this China FUD. To stupid reason for dump as for me

china they are the main operator and most of victim are from 3rd world country including my country sadly ponzi very often you will found in 3rd world country since most of them are uneducated and want instant money

No matter how much we'd want to neglect such conflicts, they are required in deciding whether Crypto is gaining widespread or not. They are much needed as well as adoption of Bitcoin by PayPal and other well known institutions IMO the FUDs can't be neglected at all cost though the effect of negativity by it has to be mitigated.

If you are talking about the PlusToken scam, then I need to inform you that most of the victims were from mainland China. But this scam stretched across the country borders, with hundreds of thousands scammed in countries such as Vietnam and Thailand. Also we don't know the actual amount that was scammed. A large fraction of the victims have refused to cooperate with the authorities and divulge their losses. 

It will be a great news if the authorities return the money to the investors that got scammed and then sell the coins in an auction. It would be great to see many Ponzi and scammers getting caught and all of their loots will be confiscated and return everything to the real investors and lock them up in jail for a long time and it should be a warning for all the scammers.

It would be way better,if the Chinese government directly refunds the coins back to the victims of that ponzi scheme.
Selling all seized coins at an auction won't be fair to all the people,who were scammed and lost their hard earned money.
Unfortunately,this will never happen and the authorities will most likely sell the coins and keep the money inside their treasure.
1% of the entire Bitcoin supply isn't that much,but I expect a small BTC price correction,when those coins are sold.

If the Chinese are smart they will keep the BTC (at least), add it to their central bank's reserves. Might come in handy in a few years when it's worth 40 or 400 billions !

That is very likely because China may want to take control of everything in the industry in the world. We know one thing is that bitcoin has an unstoppable nature and also can not be controlled . This is probably what China hates. I don't think they will ever be able to continue to dominate all industries. I believe bitcoin and its technology are the best thing and a fair system for all.

They should be fair by auctioning the seized bitcoin. And not forfeit the money to national treausry. It's a scam proceed, I doubt original investors can be traced.

It's not a FUD, it's a FACT.
They seized too much and could dump it to the market anytime they want, as no statement that those coins will be aucted but forfeited to the national treasury.
Cryptocurrency is banned in China, in this case, it is possible not to auction off the confiscated proceeds.
We can speculate that the last correction caused by China as well, or they will wait until bitcoin reaches a new ATH to sell all of it.

Nope, anything that shows even a little bit of something negative towards bitcoin is FUD.
I'm really embarrassed looking at this topic and seeing quite old members describing this as FUD, saying that is manipulation, that is not real, that...
Seriously, people have started to go nuts, this is becoming like a cult, you're not allowed to say bitcoin was used for a Ponzi scheme> 10 lashes, you're not allowed to say bitcoin is used for criminal activities > 100 lashes.

And you know what's even funnier?
The whole "don't believe in this FUD" about a Ponzi scheme comment comes from a user that has a negative trust rating (https://bitcointalk.org/index.php?action=trust;u=1126886) for advertising a Ponzi scheme! Isn't this gold?


Have you gone also full cultist mode and you're denying reality?  ;D


Yup, your belief in Virgin Mary, so with your strong belief you're going to deny facts because you believe in a heavenly purpose?
Wake up, bitcoin is used for a Ponzi scheme, fiat is used for Ponzi schemes, even cattle were used for Ponzi scheme (https://apnews.com/article/c47455202700ae022581340bc4e3e79d), cryptos are used to buy drugs, fiat is used to buy drugs, food stamps are being used to buy drugs! Reality check!!! it's money, it's valuable, it will be used for bad and good things, no matter how much you pray and you stick your head in the sand it will never change facts!!!!

is anything negative towards bitcoin categorized as FUD? Pardon me, all this time I thought FUD is false or misleading information that is spread deliberately to deceive. FUD is generally a strategy to influence perception by disseminating negative and dubious or false information and a manifestation of the appeal to fear. source (https://en.wikipedia.org/wiki/Fear,_uncertainty,_and_doubt). But yeah, negative and dubious is a manifestation of FUD.
However, this news mentions the fact that 194,775 BTC and all other coins worth over 4 billion were seized.

At least the crypto is out of the hands of criminals but they should give it back instead they say they will give it to the "treasury" which means their pockets. All that has happened is the stolen crypto has just shifted into the hands of an even bigger threat and theif.

I am not sure I believe the amount that has been seized. Police love to talk crap. When they do a drug bust they say they found 100 million worth of whatever but in reality, it's only half a million.
They won't release the addresses that now contain these seized crypto because this is communism & they much prefer to use it themselves. 

Put it this way. I wouldn't trust China to pour milk over my cereal in the morning. I would rather put my head in a croc's mouth.