A hacker once in possession of 50,000 Bitcoin (BTC) stolen from the internet marketplace Silk Road is being sentenced to federal prison.
In a new press release, the U.S. Department of Justice (DOJ) says that James Zhong has been sentenced to one year and one day in prison for stealing about 50,000 BTC from Silk Road more than a decade ago.
As stated by US Attorney Damian Williams,
“Back in 2012, James Zhong committed wire fraud by stealing 50,000 Bitcoin from Silk Road, and for the next 10 years, he managed to conceal what he had done and how he obtained his fortune. Zhong used a decentralized Bitcoin mixer, an overseas cryptocurrency exchange, and an impressive array of technological tools to frustrate tracing efforts.
But thanks to the relentless and skillful efforts of law enforcement in following the money, the federal government uncovered Zhong’s scheme and obtained final orders of forfeiture for over 51,680 Bitcoin.”
According to the press release, Zhong was able to steal the money from Silk Road by creating numerous fraudulent accounts that concealed his identity. He used the accounts to trick the dark web marketplace’s withdrawal system into releasing the BTC to him by triggering numerous withdrawal requests in rapid-fire succession.
However, in November 2021, nearly 10 years later, authorities obtained a search warrant for Zhong’s house in Georgia and were able to seize about 50,491 BTC, $661,900 in cash, precious metals such as silver bars and gold coins and 25 Casascius coins (physical BTC coins).
In 2022, Zhong began voluntarily surrendering Bitcoin. According to the DOJ, he has given up a total of 1,004 BTC since March 2022.
Earlier this month, it was reported that the government will be selling the BTC recovered from Zhong, which is now worth over $1 billion.
BTC is trading for $30,439 at time of writing, a fractional gain during the last 24 hours, but an exponential rise since it was obtained by Zhong in 2012.Don't Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
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Featured Image: Sensvector/Holmes Su