In a significant development surrounding cryptocurrencies, China has accused the United States of orchestrating one of the largest hacks in history, amounting to $13 billion. This incident, linked to LuBian, a major mining pool that controls roughly 6% of the Bitcoin network’s hashrate, has stirred controversy. Until August 2, 2025, when Arkham Intelligence uncovered the hack, neither LuBian nor the alleged hacker acknowledged the breach.
Interestingly, the hacker or hackers reportedly did not touch the seized funds for four years, a scenario that points to an actor with sufficient resources to let such a significant haul sit idle. The funds were transferred into a new wallet in June 2024, remaining untouched until the Trump administration’s Department of Justice (DoJ) indicted a man named Chen Zhi on October 14, 2025, claiming to have seized the substantial Bitcoin stockpile.
The DoJ’s indictment described Chen Zhi as the mastermind behind a sprawling cyber-fraud operation under the Prince Group banner, a criminal enterprise infamous for exploiting trafficked workers forced to execute online scams. With a particular focus on money laundering and conspiracy, the allegations encompass serious crimes, given that many victims were American citizens.
The details of the LuBian hack reveal vulnerabilities in LuBian’s security infrastructure. The hackers managed to model the keys to multiple operational wallets due to ineffective entropy sources used in private key generation. The DoJ filed a civil forfeiture complaint that resulted in the seizure of 127,272 Bitcoins, marking it as the largest forfeiture action in U.S. history.
The hack’s timeline highlights that LuBian sustained significant losses starting with a breach on December 28, 2020, where more than 90% of their Bitcoin was stolen. The following day, additional thefts were recorded, and LuBian desperately attempted to communicate with the hacker through as many as 1,500 OP_RETURN messages, pleading for the return of the funds. Analysis from Arkham Intelligence shows that the Bitcoins now controlled by the U.S. government closely overlap with those taken in the LuBian hack.
Substantial questions arise regarding the U.S. government’s acquisition of the Bitcoin associated with Chen Zhi. Reports from various cybersecurity institutions have flagged vulnerabilities in key generation tools that may have been exploited. This has led to speculation about whether the U.S. employed offensive cyber strategies as a means to undermine Chen’s criminal enterprise by targeting his Bitcoin holdings.
The Chinese Cybersecurity Agency has asserted that the U.S. might have engaged in a covert operation to retrieve the Bitcoins, suggesting a possible “black eats black” scenario orchestrated by state-level actors. The accusations from China have been persistent, with claims that the U.S. has initiated cyber attacks on Chinese entities using vulnerabilities in Microsoft Exchange servers and other high-profile targets.
While the U.S. government has not publicly confirmed the methods used to seize the Bitcoins, nor the timing of the seizure, it continues to escalate the narrative. With tensions high and allegations exchanged between the two global powers, this situation underscores the complexities and repercussions inherent in the intersection of cryptocurrency and international relations.
