Bitcoin Thief Once Worth $3.4 Billion Gets Year in Prison
A Georgia man who stole more than 50,000 Bitcoin from the Silk Road drug-trafficking site before his cache hit $3.35 billion in value was ordered to serve a year and a day in prison.
James Zhong, 32, was sentenced Friday in New York federal court, where he pleaded guilty to wire fraud last year. At the time of the heist in 2012, the Bitcoin was worth $620,000. When authorities seized devices holding the stolen Bitcoin in November 2021, its value had exploded, making it the second-largest financial seizure in US history.
Before he was caught, Zhong spent $16 million of the proceeds on real estate investments, luxury hotels, nightclubs and Lamborghinis, prosecutors said. The value of the Bitcoin seized is now about $1.56 billion.
US District Judge Paul Gardephe cited the “highly sophisticated nature of the crime” and Zhong's active concealment of the stolen Bitcoin for nine years until agents raided his house. Zhong faced between 27 and 33 months in prison under advisory guidelines, but Gardephe said he was granting leniency because of the “truly unique circumstances” in the case. Still, the judge said he also wanted to deter other criminals.
“While the victim in this case happened to be a criminal enterprise, the victim tomorrow could be a legitimate business,” Gardephe said.
Prosecutors told the judge that Zhong should get prison because he covered up his theft for nearly a decade, moving the Bitcoin through so-called mixers that make it harder to trace transactions by jumbling tokens together. But they also said he should get less than two years in prison, citing his youth, his autism and his help in recovering the stolen crypto.
Solace in Computer
Zhong's lawyers asked the judge to spare him a prison term, saying he came from
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