The Man Who Stole Over 51,680 Bitcoin

[Fivestar4everMVP]

  Here is a story of a man named Jimmy Zhong, who is said to have stolen over 51,680 Bitcoin from the illegal darknet market, Silk Road back in 2012.

In 2012, Jimmy Zhong discovered a bug on Silk Road exchange that caused him to withdraw more funds than he originally deposited or had in his account.

Over the years, the value of those stolen Bitcoins skyrocketed to more than $3 billion. However, he made a small mistake and transferred approximately $800 in funds to a cryptocurrency exchange which then asked him to go through a KYC process that required the account holder's real name and address, Jimmy did and this was how his downfall began.

Along with other evidence, three IRS agents began formulating a plan to approach Jimmy. Eventually, they obtained a search warrant for Jimmy's home, and sniffer dogs found a safe buried in concrete beneath the basement slabs containing precious metals, stacks of cash, physical bitcoins minted in the early days of the cryptocurrency and a safe with password wallet containing Bitcoins form during the Silk Road hack of 2012. Jimmy ultimately faced charges of wire fraud and, after pleading guilty, was sentenced to one year and one day in federal prison. Additionally, the stolen assets were seized by the United States government.

Jimmy turned out to be one of the first OG players in the Bitcoin community, contributing to the original Bitcoin code and providing early developers with ideas on key topics, such as how to reduce the size of the blockchain. Eventually, he changed his path and became one of the biggest Bitcoin thieves of all time.

Watch the 33 minutes video below, it contains very vital information which i believe we all can learn something from, it's very well documented, straight to the point and very informative, and also teaches is how important privacy is and can be for all of us.



Reference - BinanceFeed.

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[Japinat]

I thought this guy was Chinese, given his last name is Zhong. But his action was careless because  one wrong move, and that $3 billion, at the current price, ends up in the possession of the US government. He probably wasn't fully aware of the potential consequences of his actions at the time because he made a move that could trace his wallet for an $800 withdrawal only. I'm not sure if what they found as evidence against him is entirely accurate because based on his actions, he seems like just a regular guy who, due to a lack of knowledge about the law, made a mistake.

But the good news is that he was sentenced to "one year and one day in federal prison." He's probably regretting it big time, especially watching how Bitcoin has grown since. This article coming out during the bull run must be haunting him even more.

[Adbitco]

The question is are they still holding that volume of bitcoin he stole then till now or they have sold it? Because if they are holding till date I believe that will worth something very large, but if they sold out when it was nothing then I can see this story not to be attractive because people will be glad to hear how they managed to secure it till date. I would have clicked on the video to watch but I don't like clicking on everything I come across here with my mobile rather pc will be more better, just that I am only being mindful with the kind of links I clicked here.

[panganib999]

The question is are they still holding that volume of bitcoin he stole then till now or they have sold it? Because if they are holding till date I believe that will worth something very large, but if they sold out when it was nothing then I can see this story not to be attractive because people will be glad to hear how they managed to secure it till date. I would have clicked on the video to watch but I don't like clicking on everything I come across here with my mobile rather pc will be more better, just that I am only being mindful with the kind of links I clicked here.

It was seized. All of it apparently. He couldn't hold any of his stolen bitcoin even if he wanted to, and I can only imagine him getting tracked by the FBI and other government agencies to make sure he's not dabbling in the world of crypto again so he couldn't penetrate the space once again. What you should be curious about is how the government gained jurisdiction over him given the fact that Silk Road's not even based in the US if I'm not mistaken. I was expecting interpol to cook his ass but no, it's the US government that took him in. Also a little more tame in the punishment compared to other people who committed similar crimes but got more prison time. Kind of makes me wonder what he did behind the scenes to get to this.

[Wapfika]

Over the years, the value of those stolen Bitcoins skyrocketed to more than $3 billion. However, he made a small mistake and transferred approximately $800 in funds to a cryptocurrency exchange which then asked him to go through a KYC process that required the account holder's real name and address, Jimmy did and this was how his downfall began.

Hilarious that this notorious scammer made a small mistake by submitting KYC for small amount while he can use Mixer and DEX P2P to convert his Bitcoin without the need to undergo KYC. Also he can buy verified exchange account to cash out his money since there’s a lot of user selling this kind of account.

He makes US government increase their Bitcoin stash. I remember reading this news last year IIRC and I’m amazed on how US cyber security department watch this guy wallet address for a long time until he make a small mistake.

[Fivestar4everMVP]

The question is are they still holding that volume of bitcoin he stole then till now or they have sold it? Because if they are holding till date I believe that will worth something very large, but if they sold out when it was nothing then I can see this story not to be attractive because people will be glad to hear how they managed to secure it till date. I would have clicked on the video to watch but I don't like clicking on everything I come across here with my mobile rather pc will be more better, just that I am only being mindful with the kind of links I clicked here.

Well, I am just your type of person who is always very careful with what I click-on, on the internet, but I can assure you that the link containing the video is very safe bud, it is actually a video hosted by CNBC, i believe you know CNBC, it's one of the most reputable news outlets, i believe they also own Television channel too. So there is absolutely nothing to be afraid of checking out the video, whether you are on mobile or computer doesn't matter, except you don't have enough data, then that's a different case.

By the way, here is the raw link to the video, so you know its as clean as it can be, there is nothing to download, just click the play button on the video to watch(stream) it. https://www.cnbc.com/video/2023/10/17/the-secret-life-of-jimmy-zhong-who-stole-and-lost-more-than-3-billion.html

[franky1]

I thought this guy was Chinese, given his last name is Zhong.

he is asian. the screenshot above is not jimmy.. jimmy in the screenshot is hiding under a black jacket. the guy in blue is someone else

[Yamane_Keto]

I thought that all the Bitcoin seized by the United States government was from Silk Road back and not from hackers who stole it from them.
The prison term is not long. Cases like this are sentenced to imprisonment for dozens of years, but it appears that the amount was not much at the time of the trial and it appears that the accusation was of tax evasion.
It is strange how a person like this could make the beginner's mistake of sending $600 to the KYC process account with the personal address attached.
The report did not mention whether these bitcoins were sold.

[tabas]

I thought this guy was Chinese, given his last name is Zhong.

Usually guys like with that surname are Asian and on his case a half-half nationality which is common, and his image can be searched on Google. Jimmy or also have a real name of James is like the guy who likes to party and that made his lifestyle to be living at the fullest because he's got a lot of money. This is a good topic to discuss because it seems that news publishers have posted his story again a few days ago so it's timely.

• The secret life of Jimmy Zhong, who stole – and lost – more than $3 billion
• Guy Who Stole Billions in Bitcoin Lived a Sad Life

[dumbymamby]

The question is are they still holding that volume of bitcoin he stole then till now or they have sold it? Because if they are holding till date I believe that will worth something very large, but if they sold out when it was nothing

Maybe the government has sold all its bitcoins or distributed them to each other because that is a very large amount of bitcoins. But we don't know the truth.

The IRS's criminal investigation division eventually managed to track him down.[4] On November 9, 2021, a raid on his Gainesville, Georgia home resulted in a seizure of about 50,676 bitcoin, then valued at over $3.36 billion, from Zhong.[5] Zhong cooperated with investigators. He forfeited all of his bitcoin and pled guilty to one count of wire fraud.[6]

[Odohu]

  Here is a story of a man named Jimmy Zhong, who is said to have stolen over 51,680 Bitcoin from the illegal darknet market, Silk Road back in 2012.

In 2012, Jimmy Zhong discovered a bug on Silk Road exchange that caused him to withdraw more funds than he originally deposited or had in his account.

Over the years, the value of those stolen Bitcoins skyrocketed to more than $3 billion. However, he made a small mistake and transferred approximately $800 in funds to a cryptocurrency exchange which then asked him to go through a KYC process that required the account holder's real name and address, Jimmy did and this was how his downfall began.

He would have remained anonymous should there had been mixers then. Maybe these were the motivation for the invention of mixing technology.  I'm not justifying his action or defending him but I feel mixers are actually in line with the very reason for the creation of Bitcoin unlike CEX that make KYC compulsory.

Eventually, he changed his path and became one of the biggest Bitcoin thieves of all time.

"Changed his path" .... ""biggest Bitcoin thieves", why I'm I confused by this statement? I was thinking that changing his path means turning a new leaf and never want to have any connection to stealing.

[blckhawk]

The question is are they still holding that volume of bitcoin he stole then till now or they have sold it? Because if they are holding till date I believe that will worth something very large, but if they sold out when it was nothing then I can see this story not to be attractive because people will be glad to hear how they managed to secure it till date. I would have clicked on the video to watch but I don't like clicking on everything I come across here with my mobile rather pc will be more better, just that I am only being mindful with the kind of links I clicked here.

I think they hold auctions that has these items, iirc the FBI have done this before with other bitcoin seized from other cybercriminals. Maybe they still have the bitcoin or the wallet that contains the bitcoins but it's unlikely of them to keep it long, if they did have an auction for this, the winner of that auction would be one lucky man/woman. Or if we want to go all conspiracy theorist, the people that knows have long ago split the bitcoins to themselves.

[Fivestar4everMVP]

 Here is a story of a man named Jimmy Zhong, who is said to have stolen over 51,680 Bitcoin from the illegal darknet market, Silk Road back in 2012.

In 2012, Jimmy Zhong discovered a bug on Silk Road exchange that caused him to withdraw more funds than he originally deposited or had in his account.

Over the years, the value of those stolen Bitcoins skyrocketed to more than $3 billion. However, he made a small mistake and transferred approximately $800 in funds to a cryptocurrency exchange which then asked him to go through a KYC process that required the account holder's real name and address, Jimmy did and this was how his downfall began.

He would have remained anonymous should there had been mixers then. Maybe these were the motivation for the invention of mixing technology.  I'm not justifying his action or defending him but I feel mixers are actually in line with the very reason for the creation of Bitcoin unlike CEX that make KYC compulsory.

You are wrong brother, please watch the video to understand the whole story better. There were mixers back then, in-fact, the video, it was said or stated that Jimmy used mixing services to transfer and sell most parts of the stolen bitcoin.
What i didn't mention in the OP but was said in the video was that Jimmy's trouble began when about $400,000 dollars was stolen from a safe in his house, he called 911 who then sent police officers to his house to investigate the crime, along the line, he also made the mistake of sending $800 worth of bitcoins to an exchange where KYC is mandatory.

I personally think all this happened because his cup was full, and like we all know, something must kill a man once the man's cup is full.

Eventually, he changed his path and became one of the biggest Bitcoin thieves of all time.

"Changed his path" .... ""biggest Bitcoin thieves", why I'm I confused by this statement? I was thinking that changing his path means turning a new leaf and never want to have any connection to stealing.

Change of path can happen in both ways, that is both opposite directions. this is to say that, a person's path can change, or a person can change his or her path in the negative of positive directions, there is nothing hard here to be confused about.

[tbct_mt2]

The man, Jimmy Zhong, hid himself very well many years but with time, he believed he was already safe and began to make mistakes.

He left traces after he generously gave away bitcoin but he did not realize that his bitcoin distributions are good traces for governmental agencies to trace him. Eventually he was caught with Bitcoin backup stored in a popcorn tin.

U.S. Attorney Announces Historic $3.36 Billion Cryptocurrency Seizure And Conviction In Connection With Silk Road Dark Web Fraud

[Odohu]

He would have remained anonymous should there had been mixers then. Maybe these were the motivation for the invention of mixing technology.  I'm not justifying his action or defending him but I feel mixers are actually in line with the very reason for the creation of Bitcoin unlike CEX that make KYC compulsory.

You are wrong brother, please watch the video to understand the whole story better. There were mixers back then, in-fact, the video, it was said or stated that Jimmy used mixing services to transfer and sell most parts of the stolen bitcoin.
What i didn't mention in the OP but was said in the video was that Jimmy's trouble began when about $400,000 dollars was stolen from a safe in his house, he called 911 who then sent police officers to his house to investigate the crime, along the line,

I did not actually watch the video to understand the part where he used mixers. I just checked and found that CoinJoin was launched in 2011 which is a year before the incidence. Probably he used mixers partly and not fully else he wouldn't have been noticed from the deposit alone.

he also made the mistake of sending $800 worth of bitcoins to an exchange where KYC is mandatory.

Was this mixed coins that he deposited in the exchange? If yes, does it mean the mixer failed to do the job? If he actually used mixers, how could he be careless to deposit unmixed coins to the exchange?

I personally think all this happened because his cup was full, and like we all know, something must kill a man once the man's cup is full.

It is possible he ran out of luck so I agree with you. There is always an end to whatever that is not genuine.

[NotATether]

You left out a lot of important details.

First he reported to the Feds when his house was robbed - there was a suitcase full of cash in there that was stolen.
That was a big mistake because that was when he first started getting monitored closely.

Then the KYC exchange thing, like you said.

A couple months later, he made his infamous mistake of putting clean coins and dirty coins in the same transaction. It wasn't long after that before he was busted.


Some documentary I watched said he only got the suitcase full of cash because it's "like they do in the movies". This is a very good example of why you should also not mess with too much hard cash 

[sokani]

he also made the mistake of sending $800 worth of bitcoins to an exchange where KYC is mandatory.

Was this mixed coins that he deposited in the exchange? If yes, does it mean the mixer failed to do the job? If he actually used mixers, how could he be careless to deposit unmixed coins to the exchange?

Of course, he's been using mixers to conceal his identity, but I don't know why he made such a huge mistake. This time around he didn't use a mixer, he sent $800 to an exchange where he had already done KYC. Unknown to him the address of the stolen Bitcoin has been under surveillance for years. So through the transaction to the exchange, the feds were able to know his identity.

Prior to this mistake, there's a time he had a burglary attack at his home. He called 911 and the police came and took details of what happened.

So when the feds have gotten his identity, they paid him a visit, pretending that it was a follow up to his burglary case. He didn't know they had body cams and were surveiling the house. After they've gotten all they wanted, they left and came back, this time around with a search team, a search warrant and sniffing dogs.

[el kaka22]

To be fair he does look like not a horrible human being. Surely stealing 51k worth of bitcoin is a terrible thing to do, but at the time of doing it, it was probably closer to 50k more like, or at worst case maybe 500k? It wasn't 3+ billion at the time he stole, it was like that at its peak and I am sure that stealing anything under a million should be seen as "let's see what the story is". I am not saying he is a good guy, don't get me wrong, but crypto made me so used to seeing people stealing crypto that I have seen people stealing more than 500k multiple times a year for the past 10 years, and that means this guy just did it earlier than most, but didn't do anything new to me.

Just the other day Stake got hacked for 40 million, that is about 40 times more than this guy did, maybe 80 times, and when you think about it that way, it doesn't really feel like he has to be a bad guy, plus he helped with bitcoin so I would say that's a good plus for him as well.

[Prancheiro]

... After they've gotten all they wanted, they left and came back, this time around with a search team, a search warrant and sniffing dogs.

It caught my attention that there are dogs trained to sniff out computer hardware!

BTW, if someone wants to watch the vid:
https://www.youtube.com/watch?v=3Nq3ye-QCyM

[avikz]

Wrongdoings are wrongdoings, regardless of the fact that the Bitcoins were stolen from another illegal entity. Probably that's the reason he only got one year of imprisonment for stealing close to 3 billion dollars.

I really hope all hackers get their part of karma for stealing money. They are real threats to the society and with the advancement of internet, it has become even more lethal. Justice has to be served, today or tomorrow.