According to a report by American financial media CNBC on October 15, U.S. law enforcement agencies uncovered a large-scale 'pig-butchering' scam in Cambodia, seizing 127,271 bitcoins held by the mastermind behind it, with a total value of about $15 billion. This is the largest confiscation operation in the history of the U.S. Department of Justice.
The U.S. Federal Court in Brooklyn, New York, announced an indictment on October 14, accusing 37-year-old Chen 'Vincent' Zhi and others of conspiracy to commit wire fraud and money laundering. Zhi is currently at large and is believed to still be in Cambodia. If convicted, he could face up to 40 years in prison.
"As alleged, the defendants are the masterminds behind a vast wire fraud empire that operates under the umbrella of the princely group. This is a criminal enterprise built on the suffering of others. USA Today quoted a statement from U.S. Assistant Secretary of Justice John Eisenberg as saying, "Trafficked laborers are held in prison-like places and forced to commit large-scale wire fraud, with thousands of victims around the world, including many Americans." ”
Most of the people imprisoned in scam compounds were lured there by high-paying job advertisements. They were coerced by criminals through debt and violence, becoming 'modern slaves' and forced to defraud strangers via instant messaging apps. 'Over time, they often build relationships with the victims, gain their trust, and then steal their money,' CNBC wrote.
According to reports, Southeast Asian online scam networks are well-organized and have clear divisions of labor. Gangs in Myanmar set up fake investment platforms on servers in Singapore, while gangs in Cambodia use casinos and real estate projects in Phnom Penh and Sihanoukville to transfer funds, which ultimately end up in digital wallets in Dubai.
When gold breaks through historical highs, Bitcoin takes a plunge from the heights. Behind this divergence of assets lies the ultimate game of 'credit.' Previously, the shocking case in which the U.S. Department of Justice seized 120,000 Bitcoins from the BitPrince Group had already foreshadowed today's outcome.
These 120000 BTC were not just confiscated. In fact, as early as June July 2024, the blockchain showed that they had been moved to a wallet controlled by US authorities. It was only a few days ago that DOJ began to formally accuse them.
Although Chen Zhi's main business is engaged in electronic fraud and pig killing, in fact, these BTC are mainly obtained through mining, from his affiliated LuBian Bitcoin Mining company (LuBian Mining).
Prior to 2020, LuBian held approximately 6% of the computing power in global Bitcoin mining and was one of the important mining entities with deep ties to Iran.
The United States has started to steal money, which is the truth behind the so-called tariff war, trade war, financial war, and technology war.
Some people can't help but feel that Bitcoin seems to be designed for money laundering and dirty money, no matter how beautiful it was initially disguised. The essence of blockchain and decentralization is to prevent wealth from being traced. But when Bitcoin was born, was it just for this dirty purpose?
I. The Collapse of Prince Group, Bursting Two Bitcoin Myths
Once, Bitcoin was hailed as the ideal currency of the "lawless realm"—decentralized, anonymous, and untraceable. However, the exposure of the Tai Shing Group case, like a meticulously orchestrated financial spy thriller, shattered these three illusions one by one.
1.The Vulnerability of "Decentralization"
Faced with the might of sovereign forces, the Crown Prince Group laundered over $10 billion through Bitcoin, operating for a decade, convinced it had built an impenetrable financial firewall.
However, the U.S. Department of Justice, through collaboration with global exchanges and the use of on-chain analysis technology, successfully tracked and ultimately seized 123,000 bitcoins.
Core Analysis: The so-called "decentralization" is merely reflected in the technical architecture. When sovereign states exercise their judicial, regulatory, and global coordination capabilities, key nodes of the Bitcoin network (such as exchanges and development teams) remain under centralized oversight.
2. The complete collapse of "anonymity": every transaction under the sun
The group employed then-advanced anonymity techniques such as coin mixing services.
However, modern on-chain analysis techniques have successfully reconstructed its financial chain by examining behavioral patterns and transaction correlations.
Core Analysis: The Bitcoin blockchain is a globally public ledger. The so-called "anonymity" merely replaces names with a string of character addresses. Once an address is linked to a real identity through offline means (such as exchange KYC), all historical transactions become fully traceable.
Conclusion: The case of the Taiping Group demonstrates that Bitcoin's "anti-censorship" feature is rendered ineffective when confronted with "dimensional reduction attacks" by state-level forces.
II. The Value Roots of Gold, Fiat Currency, and Bitcoin
When the myth of Bitcoin collapses, we need to more calmly examine the true value origins of various assets.
1.Bitcoin: Code without Credit
Essence: A string of code generated by algorithms, whose value relies entirely on community consensus and speculative psychology.
Defects: No intrinsic value, no lender of last resort, highly volatile prices, unable to fulfill the core function of currency.
Warning: Any programmer can fork their code and create new "Dogecoin" or "Catcoin", and the possibility of unlimited supply fundamentally shakes their belief in scarcity.
2.Gold: The Ultimate Credit Beyond Sovereignty
Essence: The ultimate store of value recognized by global civilizations for thousands of years.
Advantage: It does not rely on any national credit and has real industrial and decorative uses, making it a "ballast stone" for dealing with sovereign credit crises.
Current role: Against the backdrop of high global debt and geopolitical turmoil, the safe haven nature of gold continues to strengthen.
3.Fiat currency: a reflection of a country's comprehensive strength
Essence: A legal means of payment endorsed by national sovereignty and credit.
Value support: Behind it are a country's military, technological, economic strength, tax capacity, and legal enforcement.
Core advantage: It has unlimited legal solvency and value stability (regulated by the central bank through monetary policy). When a crisis occurs, the state apparatus is its last and most powerful guarantee.
III. How to Allocate Assets in an Era of Trust Collapse
In the face of the Bitcoin trust crisis and the uncertainty of the global financial system, a rational asset allocation strategy is crucial.Some thoughts on holding fiat currency as follows:
1.Diversified allocation of strong fiat currencies
In the context where the US dollar remains the dominant international settlement currency, holding a certain proportion of US dollar assets is a necessary measure to address potential risks.
At the same time, pay attention to the stable economic fundamentals and prudent monetary policies of economies' currencies (such as the renminbi), and achieve diversification of the currency basket.
2. The strategic position of gold is unshakable
In the current environment, gold should be allocated as a core safe haven asset, and the proportion can be appropriately increased according to individual risk tolerance to hedge the credit risk and inflation risk of fiat currencies. However, it is already very high and should be cautious.
3. Repositioning Bitcoin and Cryptocurrencies
It must be soberly recognized that they are high-risk speculative assets, not currencies.
Its price fluctuates greatly and faces increasingly tightening global regulations. Any investment should be strictly controlled within a range that can withstand complete losses.
Conclusion:
The confiscation of 120000 bitcoins by the Crown Prince Group is not an accidental event, but a metaphor of an era. It declared the shattering of the illusion of "code as credit".
It's not just the United States that's starting to harvest, Britain has also started. On September 29th, Qian Zhimin, the main culprit of the largest Bitcoin money laundering case in the UK and the illegal fundraising case of Tianjin Blue Sky Grid in China, appeared in court in London for trial. More than 128000 Chinese people were defrauded in this case, involving 61000 bitcoins (approximately 49.35 billion yuan) frozen by the British government. Whether this money can be returned to the victims in China is clearly an unknown variable.
In the millennium long history of human finance, true trust has never originated from encryption algorithms, but from strong organizational capabilities, stable legal systems, and sustainable economic output - these are precisely the most valuable credit endorsements that a modern sovereign state can provide.
In turbulent times, it is more important than ever to recognize what truly constitutes a 'hard asset'.
Leave a comment