China’s national cyber defense agency has made big claims around the alleged role of the US in the multibillion-dollar hack of LuBian, once a major Chinese Bitcoin mining pool.
The Chinese National Computer Virus Emergency Response Center (CVERC), a state-backed cyber defense agency, on Sunday published a technical analysis report on the 127,272 Bitcoin (BTC) stolen in the LuBian hack.
Although the hack occurred in December 2020, it remained largely unknown to the public until recently, with Arkham reporting it in August as the “largest ever” Bitcoin hack.
The CVERC’s analysis came weeks after the US filed a civil forfeiture complaint for 127,271 BTC (worth about $14.5 billion) in a criminal case against Prince Group founder Chen Zhi, who reportedly owned the BTC held by LuBian before it was hacked.
US already held seized Bitcoin, China says
While formally filing to seize the $14.5 billion fortune in mid-October, the US government had already been holding the assets in custody, according to the indictment statement.
“Those funds are presently in the custody of the US government,” the statement noted, adding that the complaint is the “largest forfeiture action in the history of the Department of Justice.”
The CVERC highlighted that the US government has not disclosed in the indictment how it obtained access to the funds, and claimed the US had been in control of the assets for more than a year, citing Arkham data.
According to Arkham data, an address labeled “LuBian.com Hacker” sent 120,576 BTC — almost its entire holdings — to an address labeled “US Government: Chen Zhi Seized Funds” in a single transaction on July 5, 2024.
The CVERC said the stolen Bitcoin on the LuBian hacker’s addresses had remained dormant for nearly four years following the hack until the funds were “fully taken over by the US government” last year.
CVERC said the long dormancy of the stolen Bitcoin before the US seizure “is clearly inconsistent with the nature of ordinary hackers who are eager to cash out and pursue profits.”
It is more like a precise operation orchestrated by a state-owned hacking organization.”
The CVERC report also said Zhi and his Prince Group repeatedly sent messages to the hacker address via Bitcoin transactions of roughly $23 each, pleading for the return of the stolen BTC and offering a reward, but received no response.
The report adds a geopolitical dimension to one of the most mysterious crypto thefts in history.
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According to Arkham, the batch of LuBian-derived Bitcoin holdings accounts for at least 39% of all 326.5 BTC ($34.2 billion) held in US government-associated addresses at the time of publication.
US President Donald Trump recently declared that the US is “far ahead of China and everybody else” in cryptocurrency adoption. “China is getting into it in a very big way right now,” he said in an interview with CBS News’ 60 Minutes on Nov. 2.
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