Geeky crypto thief, 32, jailed for hiding $3billion in Bitcoin in popcorn tin

[Flexystar]

Ahh, I think I already posted this last week. James Zhong captured for $3.4 billion worth stolen bitcoin- USA cracks hesit

From what the news analysis was done, he got the bitcoins from the dark web and it was merely a back door to some sort of algorithm glitch. Whenever they bought any illegal stuff and clicked deposit the bitcoin, they received the double amount. Apparently, James was smart enough to find the loophole and he worked straight for 6 hours on the strategy to get as much Bitcoin as he could.

Considering he was just 22, it did not occur to him whether he was stealing. Plus, he was in the dark web + crypto, so yeah what the hell, he anyways started pulling bitcoins and finally stopped at 50,000 bitcoins.

The value increased over time, and he ended up being a billionaire by 2021. Cool story.

He is under trial right now and lawyers are pushing hard to just get him two years prison time and get back as quickly as he could for the party time. Rich!

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[pawel7777]

Silk Road is not an exchange. It is a dark web market place that has been shot down about a decade ago by the American government, so that's the reason the recovered bitcoin could not be returned.

Which kind of begs a question - is stealing from an illegal site illegal itself? I don't think there's any identified victim in this case. If there were - bitcoins should've been returned to them. I don't think the "no victim - no crime" would be applicable here, but the whole situation is still kind of weird, especially considering he didn't hack the site, just took advantage of the glitch:

From what the news analysis was done, he got the bitcoins from the dark web and it was merely a back door to some sort of algorithm glitch. Whenever they bought any illegal stuff and clicked deposit the bitcoin, they received the double amount. Apparently, James was smart enough to find the loophole and he worked straight for 6 hours on the strategy to get as much Bitcoin as he could.

That's a huge amount of money getting traded at one time. It's a huge dump happening, so the price will certainly be affected. However, if that's really the main reason, then I guess the dump is just temporary since Coinbase has over $1.6 billion in 24-hour trading volume. Alternatively, the best idea is to divide the amount of Bitcoin to be traded in different exchanges, if the government allows it.

The article says they have sold the first batch and will be selling 4 more during the calendar year. So it's not like they're dumping it all at once.

[Fivestar4everMVP]

This guy is a f**king moron, $3 billion dollars is a whole lots money, he could have done better things with this money rather than sleeping around with girls, does this means he had no life goals, or maybe business ideas or something?
Really pathetic and I think he clearly deserves whatever punishment that he's meeted with.

Hmm, could it be that this has something to do with Bitcoin struggling to keep above the $30k?

Probably yes, I myself have been wondering what lead to the sharp decline in the price of bitcoin yesterday, clearly this was the reason, I really hope that the market recovers soon though.

[Dr.Bitcoin_Strange]

$3 billion is a whole lot of money! According to the report, this is actually the highest amount of stolen bitcoin recovered from an individual and I think this could be the reason why bitcoin price is still struggling at the $30,000 market price.

Now that the feds have rushed to sell off 9,861 bitcoins already, what's the rush to sell it for? What purpose do they have to use the money for? What if that bitcoin was not discovered? What would they have sold to obtain the $$215,738,155 they have already sold out? I don't know why I don't just find this story funny. It's not even as if citizens are going to reap the benefits of this money. Well I think that's why Bitcoin price is still struggling to maintain $30k, it may also be a wrong assumption by me.

Silk Road is not an exchange. It is a dark web market place that has been shot down about a decade ago by the American government, so that's the reason the recovered bitcoin could not be returned.

I was not aware of that, but @Cantsay already mentioned it. That guy just got so greedy; how could he have even held up such an asset to himself and even used it so unreasonably?

[sokani]

Now that the feds have rushed to sell off 9,861 bitcoins already, what's the rush to sell it for? What purpose do they have to use the money for? What if that bitcoin was not discovered? What would they have sold to obtain the $$215,738,155 they have already sold out? I don't know why I don't just find this story funny. It's not even as if citizens are going to reap the benefits of this money.

Ross Ulbricht (owner of Silk Road) defence and the prosecution counsel had an agreement that any stolen BTC recovered from Silk Road would be forfeited to the US government.

That guy just got so greedy; how could he have even held up such an asset to himself and even used it so unreasonably?

I think it's his lifestyle that attracted the attention of security agency. He was living a lavish lifestyle, lodging in the most expensive hotel suites, clubbing, and partying. The dude invested more in real estates and also had 7 powerful boats and it's interesting to note that despite all this extravagant lifestyle, he has only spent 5% of the stolen BTC.

[cr1776]

Hard to believe he got off with only a year.  Makes one wonder what SBF will get away with.  Let's see if SBF's was $21 billion and his was 3, maybe he'll get 7 years.      As mentioned above, if they were liquidating that much in a short, it certainly would increase the supply and consequently decrease the price. 

[batang_bitcoin]

That guy just proved the meme that we're seeing on socials about claiming that he's got bitcoin so b***** comes to him and make him as their man.

This guy is a f**king moron, $3 billion dollars is a whole lots money, he could have done better things with this money rather than sleeping around with girls, does this means he had no life goals, or maybe business ideas or something?
Really pathetic and I think he clearly deserves whatever punishment that he's meeted with.

Whether he did good business with that money and not after the girls, it still going to end up with the criminal act of swindling that lot of money. In the first place, stealing money and using it for whichever purpose (good or bad) that he may come up with is a no-no.

[logfiles]

Which kind of begs a question - is stealing from an illegal site illegal itself? I don't think there's any identified victim in this case.

Good thing you said "stealing" 
There is no good stealing. It's still a bad moral practice. I for sure wasn't active in the crypto space during the times of Silk Road marketplace but I think the person behind it created the platform for good intentions

The Government call such platforms "illegal" because they don't regulate them. More like how they have demonized Bitcoin over the years, but what the guy stole was actually Bitcoins from people. Not just from a thin air.

especially considering he didn't hack the site, just took advantage of the glitch

Same thing, he took advantage

From my understanding of Hacking, it's the practice of recognizing and then taking advantage of the vulnerability in a website, app or computer system, to gain unauthorized access to data and funds like in this case because those stolen funds did not belong to the geeky Crypto thief.

[pawel7777]

I for sure wasn't active in the crypto space during the times of Silk Road marketplace but I think the person behind it created the platform for good intentions

Mmm, not really. I think it was created just for profit. The operator is serving a double lifetime, but the verdict was highly controversial and very unfair.
You can find more details here:
https://freeross.org/

The Government call such platforms "illegal" because they don't regulate them. More like how they have demonized Bitcoin over the years, but what the guy stole was actually Bitcoins from people. Not just from a thin air.

There's a problem here, if he stole (or however we want to call that) bitcoins from users, then it would be expected for authorities to make at least some attempt to identify original owners and try to reimburse them instead of just selling their assets and keeping the profits.
But if he stole from SilkRoad-owned stash, then the feds could seize that as proceeds from illegal activities.

From my understanding of Hacking, it's the practice of recognizing and then taking advantage of the vulnerability in a website, app or computer system, to gain unauthorized access to data and funds like in this case because those stolen funds did not belong to the geeky Crypto thief.

I think that's broadly in line with the legal definition in most countries, but the "to gain unauthorised access" is the key here. From what I read, it was not really the case.
Possibly, with a help of a good lawyer, he could possibly get away without serving any time, but since all his money got seized, he's unlikely to afford one. A little prison time probably will do him good.

[PX-Z]

Sending Bitcoin to Coinbase (a centralized exchange) from a wallet that holds about 50,000 bitcoins was so unwise of him, and there was not even a reasonable thing he was using the money for. Well, this should serve as a lesson for people who solely depend on trading their bitcoin on centralized exchanges.

More like for privacy—private way. The guy is not knowledgeable enough how bitcoin transaction works. Mixers do exists now and lots of them yet we see another guy caught because of sending tainted coins directly on CEX. Well, as he is mentally-illed so i understand.

Also, the guy got collectible coins, shout out for our physical bitcoin collectibles out there, i wonder if anyone made a transaction between him or he has an account here.

[suzanne5223]

Sending Bitcoin to Coinbase (a centralized exchange) from a wallet that holds about 50,000 bitcoins was so unwise of him, and there was not even a reasonable thing he was using the money for. Well, this should serve as a lesson for people who solely depend on trading their bitcoin on centralized exchanges.

More like for privacy—private way. The guy is not knowledgeable enough how bitcoin transaction works. Mixers do exists now and lots of them yet we see another guy caught because of sending tainted coins directly on CEX. Well, as he is mentally-illed so i understand.

Also, the guy got collectible coins, shout out for our physical bitcoin collectibles out there, i wonder if anyone made a transaction between him or he has an account here.

The only reason why the guy Zhong was apprehended is that he lack the knowledge of privacy and this also happened to a lot of newbies cause they always believe the BTC transaction are anonymous while it was actually pseudonymous.
Having said that, it is easy to understand the naiveness of the guy in possess of the BTC base on how he wants to send the BTC on a lavish lifestyle to help him score women
Assuming he didn't make use of the crypto tumbler website, making use of an anonymous crypto exchange like Crypton Exchange by exchanging the BTC to Monero the story would have changed.                                                                                                               

[BenCodie]

Hard to believe he got off with only a year.  Makes one wonder what SBF will get away with.  Let's see if SBF's was $21 billion and his was 3, maybe he'll get 7 years.     As mentioned above, if they were liquidating that much in a short, it certainly would increase the supply and consequently decrease the price.  

He hacked $41 a long time ago, it happened to grow into that value in the future. He did not hack $3 billion. On the other hand, SBF embezzled and hid this amount, spent it to grow FTX fraudulently, manipulated the crypto market, ruined many lives and liquidated billions worth of traders that otherwise would not have been liquidated as a result. The two are not in any way comparable.

This guy is a f**king moron, $3 billion dollars is a whole lots money, he could have done better things with this money rather than sleeping around with girls, does this means he had no life goals, or maybe business ideas or something?
Really pathetic and I think he clearly deserves whatever punishment that he's meeted with.

This is just fucking crazy for him someone to have the intention to steal such a big amount of money. He wants to please his slots to believe him that he has the money to spend on them. His reasoning is a bit detrimental to my perception of having an odd reason of living a luxury lifestyle. Some persons can be very funny when it comes to why they want to be rich probably illegally. This is not a good reason to be a theft for crying out loud. If he was not jailed then any consequential treatment he was given should teach him a lesson.

The value at the time the coins were hacked from SilkRoad, was $41. He did not steal $3 billion. That is just the market value at the time of seizure.

Hmm, could it be that this has something to do with Bitcoin struggling to keep above the $30k?

That's a huge amount of money getting traded at one time. It's a huge dump happening, so the price will certainly be affected. However, if that's really the main reason, then I guess the dump is just temporary since Coinbase has over $1.6 billion in 24-hour trading volume. Alternatively, the best idea is to divide the amount of Bitcoin to be traded in different exchanges, if the government allows it.

Right now, Binance has the biggest trading volume with $12 billion daily. So, if some trades are done in Binance, then there won't be much effect on the overall market price.

https://coinmarketcap.com/rankings/exchanges/

It has already been said by multiple outlets that when coins are not auctioned, they are sold on Coinbase. The U.S. Government would not be using Binance to trade these coins especially after the CTFC suit against them.

[pawel7777]

More like for privacy—private way. The guy is not knowledgeable enough how bitcoin transaction works. Mixers do exists now and lots of them yet we see another guy caught because of sending tainted coins directly on CEX. Well, as he is mentally-illed so i understand.

Mixing alone wouldn't help him much if he was splashing money on expensive speedboats etc. Assuming he wasn't a high-earner himself, it was just a matter of time for him to get red-flagged.

But you can't expect too much from a guy who stores $3bn worth in a popcorn tin in his bathroom.

Also, the guy got collectible coins, shout out for our physical bitcoin collectibles out there, i wonder if anyone made a transaction between him or he has an account here.

I was wondering that too. I think it's very likely, considering the collectible coins and the fact he was in the Bitcoin early, and I think that the majority of the early adopters were active on the bitcointalk, or at least familiar with it.

[nutildah]

Also, the guy got collectible coins, shout out for our physical bitcoin collectibles out there, i wonder if anyone made a transaction between him or he has an account here.

He does have an account here:

Loaded

What's funny is he used to pretend that he made all his Bitcoin from trading and running a trading fund for wealthy investors... Of course that was all a lie. Not that there wasn't some level of ingenuity involved in how he actually achieved his BTC wealth.

This thread is what made him famous, at least on the forum anyway. It wasn't too long after he posted this that people started figuring out where his BTC really came from.

[PX-Z]

He does have an account here:

Loaded

What's funny is he used to pretend that he made all his Bitcoin from trading and running a trading fund for wealthy investors... Of course that was all a lie. Not that there wasn't some level of ingenuity involved in how he actually achieved his BTC wealth.

This thread is what made him famous, at least on the forum anyway. It wasn't too long after he posted this that people started figuring out where his BTC really came from.

Wow! So he really did. Btw how did you get his info, or knew that he own that account. Although it looks like it really is based on the thread linked but i'm not so sure.

Mixing alone wouldn't help him much if he was splashing money on expensive speedboats etc. Assuming he wasn't a high-earner himself, it was just a matter of time for him to get red-flagged..

It could but yeah, mixing alone wont help, besides that he is mentally ill and no family background of having rich family,so having such luxury life is really suspicious.

[nutildah]

Wow! So he really did. Btw how did you get his info, or knew that he own that account. Although it looks like it really is based on the thread linked but i'm not so sure.

It was actually mentioned in a court document that was released not too long ago, although I can't find it at the moment. It has also been mentioned in the media:

https://www.theblock.co/post/183749/silk-road-hacker-was-bitcoin-og-who-once-tried-to-bet-with-bitcoin-jesus-roger-ver

Silk Road hacker James Zhong may have been “Loaded,” the online persona who described himself as a “Bitcoin multimillionaire, broker, and asset manager” and made 135 posts on BitcoinTalk between November 2012 and March 2017.

Comments from around the time described Loaded as a “legend” and said he deserved the “legendary” title on the forum. Others were more suspicious of him. Silk Road hacker James Zhong may have been “Loaded,” the online persona who described himself as a “Bitcoin multimillionaire, broker, and asset manager” and made 135 posts on BitcoinTalk between November 2012 and March 2017.

Comments from around the time described Loaded as a “legend” and said he deserved the “legendary” title on the forum. Others were more suspicious of him.

The last page of this thread has some great details about the case and how he was busted after nearly 10 years. It would appear that most of the time he was living off the proceeds from his BCH fork split rather than the BTC itself.

[eaLiTy]

~
By mentally disabled, do you mean autistic? Well, some autistic people can be intelligent, but autism does cause problems in relating to others, although I don't know to what extent in his case since he studied at the University.

Elon Musk has Autism and one of my Engineering department head was autistic and dealing with him was a pain in the arse as he was too stubborn . So being autistic does not mean that they are not intelligent.

On the other hand it is pathetic that he spent a lot of money to try to impress women and didn't attract them. I imagine that the ones in the photos are escorts. Very strange because a guy with a lot of money always attracts women interested, no matter how ugly he is, who wants to get his money but at least he fucks them. The article also states that he abused cocaine and alcohol.

You need to have personality and money to attract women, 1 year sentence for a big heist is a small sentence while Ross Ulbricht who ran a website is serving double life sentence with trumped up charges .

[Wind_FURY]

Also, the guy got collectible coins, shout out for our physical bitcoin collectibles out there, i wonder if anyone made a transaction between him or he has an account here.

He does have an account here:

Loaded

What's funny is he used to pretend that he made all his Bitcoin from trading and running a trading fund for wealthy investors... Of course that was all a lie. Not that there wasn't some level of ingenuity involved in how he actually achieved his BTC wealth.

This thread is what made him famous, at least on the forum anyway. It wasn't too long after he posted this that people started figuring out where his BTC really came from.

It was very ingenious. He got all that Bitcoins by exploiting a Dark Market site called the Silk Road. The exploit was said to have allowed him to withdraw many times from the site's wallet without making any new deposits. The site admins can't go the government/police for help, neither can they announce that they were hacked.

[pawel7777]

Also, the guy got collectible coins, shout out for our physical bitcoin collectibles out there, i wonder if anyone made a transaction between him or he has an account here.

He does have an account here:

Loaded

What's funny is he used to pretend that he made all his Bitcoin from trading and running a trading fund for wealthy investors... Of course that was all a lie. Not that there wasn't some level of ingenuity involved in how he actually achieved his BTC wealth.

This thread is what made him famous, at least on the forum anyway. It wasn't too long after he posted this that people started figuring out where his BTC really came from.

I knew it! Thanks. But how do we know for sure it's the same guy? Some of his posts seems sound (somewhat) sensible, and the actions he took (as per article) make me imagine he was definitely on the dumb-side.

I remember that bet that he offered to Roger Ver. Iirc, Ver accepted eventually but Loaded backed away.

And just a reminder, if anyone presents themselves as a professional investor, hedge fund manager etc. it's 99% bullshit.

[BenCodie]

Also, the guy got collectible coins, shout out for our physical bitcoin collectibles out there, i wonder if anyone made a transaction between him or he has an account here.

He does have an account here:

Loaded

What's funny is he used to pretend that he made all his Bitcoin from trading and running a trading fund for wealthy investors... Of course that was all a lie. Not that there wasn't some level of ingenuity involved in how he actually achieved his BTC wealth.

This thread is what made him famous, at least on the forum anyway. It wasn't too long after he posted this that people started figuring out where his BTC really came from.

It was very ingenious. He got all that Bitcoins by exploiting a Dark Market site called the Silk Road. The exploit was said to have allowed him to withdraw many times from the site's wallet without making any new deposits. The site admins can't go the government/police for help, neither can they announce that they were hacked.

Hardly ingenious in comparison to what hackers and people who are even intermediate in the field of hacking are capable of doing. He was just in the right place at the right time with a skill-set that was somewhat niche at the time, and made less than $100 from exploiting a hole.

The saddest part about this thread is that if he had very average american-like looks, was not suspected of "autism" or whatever the crap people are saying here, then what other discussion would there be aside from the crime? The thread title "geeky" - the entire thread "nerd", "autism", etc. It's just pathetic.

I used to to think you were kind of a fine guy pawel7777, your posts are usually pretty good. Since coming to this thread though my view has changed, along with some other users who have jumped on the bandwagon.