The $87m Bitcoin Heist

The $87m Bitcoin Heist

The $87m Bitcoin Heist

Chinese police have arrested three suspects alleged to have stolen assets worth 600 million yuan ($87 million) through hacking, state media reported Sunday, as cyber criminals target holders of bitcoin and other virtual currencies.

Police in the northern city of Xian began investigating in March when a victim surnamed Zhang complained that hackers had taken control of his computer to steal 100 million yuan ($15 million) worth of cryptocurrency, the Shaanxi Daily reported.

The 100 million yuan haul was made up of the popular bitcoin and ether currencies, state news agency Xinhua reported.

The transfer of the units provided police with a virtual trail, the Shaanxi Daily said, leading them to a suspect surnamed Zhou in the central province of Hunan.

Zhou’s communications led to two more alleged accomplices. Altogether, the three suspects are thought to have stolen 600 million yuan by hacking the computers of individuals and companies, according to the newspaper.

The police investigation is still underway, it said, with officers in three provinces working together last week to take the suspects into custody.

In February an official Chinese publication announced plans to stamp out all remaining cryptocurrency trading in the country by blocking access to overseas-based websites and removing related applications from app stores.

The moves were outlined in a report by Financial News, a publication under the People’s Bank of China, which said the aim was to snuff out the “dying cinders” of cryptocurrency trading and initial coin offerings “which are glowing once more”.

In South Korea

The deal sounded murky from the start: in exchange for bitcoin worth two million euros ($2.3 million), the wealthy buyer would hand over the equivalent sum in cash in a luxury hotel on the French riviera.

The seller, a South Korean businessman with a company specialised in the crypto-currency in Singapore, accepted the proposition nevertheless and met the Serbian buyer in July.

But once the transaction was completed in a hotel in the city of Nice, the South Korean realised the 500-euro notes he had been handed were crude, photocopied fakes, police sources told AFP.

After the victim filed a criminal complaint at the end of July, the Serbian man was arrested at a top-end hotel in the glitzy town of Cannes in the south of France, apparently living the high-life with a luxury car and a 100,000-euro watch.

After appearing in court, he was remanded in custody on charges of fraud and being part of a organised crime network, his lawyer Gerard Boudoux told AFP on Sunday.

Police are still looking for his alleged accomplice.

The South Korean said he had been approached by the men initially over a possible investment in his company.

The discussions led instead to the transaction that would see the South Korean transfer the bitcoin to a foreign account in exchange for the cash.

Regulators worldwide are grappling with the boom in crypto-currencies like bitcoin, which are known to be used by criminals for transactions and money-laundering.

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S. Jack Heffernan Ph.D. Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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