Chinese police seized crypto assets worth $4.2B today from PlusToken Ponzi

Court filings from Nov. 19 show that a large volume of crypto assets, including Bitcoin and Ether, was seized from seven convicts in the PlusToken case.

The PlusToken controversy, which has led to the arrest of 109 individuals so far, has also reportedly resulted in a titanic seizure of crypto assets by Chinese authorities worth $4.2 billion at today’s prices.

According to court filings released publicly on Nov. 19 and posted by The Block, authorities seized a staggering 194,775 Bitcoin (BTC), 833,083 Ether (ETH), 1.4 million Litecoin (LTC), 27.6 million EOS, 74,167 Dash, 487 million XRP, 6 billion Dogecoin (DOGE), 79,581 Bitcoin Cash (BCH) and 213,724 Tether (USDT) from seven individuals convicted in the case.

According to the ruling from the Yancheng Intermediate People’s Court, gains from the seized crypto assets will be forfeited to the national treasury. The precise details of how the assets will be dealt with and processed in accordance with national laws have not been fully spelled out.

The PlusToken scheme, which first released its white paper back in Feb. 2018, had presented itself as a South Korean crypto exchange and wallet provider that could provide users with interest-bearing accounts capable of generating between 8% and 16% returns monthly, with a minimum deposit of $500 in crypto assets.

According to local reports in Sept. 2020, PlusToken drew in 2 million members between May 2018 and June 2019.

The Yancheng Intermediate People’s Court puts the estimated figure of members at 2.6 million, and outlines that the scheme absorbed 314,000 BTC, 117,450 BCH, 96,023 Dash, 11 billion DOGE, 1.84 million LTC, 9 million ETH, 51 million EOS, and 928 million XRP by June 27, 2019.

At the time of their absorption, these funds were reportedly with close to 15 billion yuan — roughly $2.2 billion. In today’s bull market conditions, that value is significantly higher.

Some of the funds were used to incentivize members to recruit new targets, while some were cashed out for daily expenses and personal spending by the scheme’s ringleaders.

By summer 2019, the scheme had ceased operations, citing purported “system maintenance,” in what appears to have been one of the industry’s largest-ever exit scams. Chinese authorities closed in, arresting and/or detaining many of the key individuals involved. 

The Yancheng Intermediate People’s Court ruling notes that 15 individuals have been convicted to date, and have been sentenced to between two and 11 years in jail, with fines ranging between $100,000 and $1 million.

Additional reporting by Ting Peng

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