U.S. Sanctions Chen Zhi, Links 127K Bitcoin to Crypto Fraud Case

The U.S. government has taken major action against the Cambodian businessman Chen Zhi. Accusing him of leading a vast transnational criminal network tied to cryptocurrency investment fraud. The indictment, filed on October 8 by the U.S. District Court for the Eastern District of New York. Alleges that Chen Zhi, also known as Vincent, used the Cambodian Prince Group to operate fraudulent investment schemes across more than 30 countries.

Massive Crypto Fraud Network Exposed

According to the Department of Justice (DOJ), Chen Zhi’s network ran at least ten fraud compounds in Cambodia. It targets victims worldwide with so-called “pig butchering” scams. A long term schemes that lure investors into fake crypto opportunities before wiping out their funds. Authorities estimate that the network caused billions of dollars in global losses. The DOJ is now seeking to seize 127,271 Bitcoins, worth roughly $12 billion. Along with other luxury assets such as private jets and yachts. Chen faces charges of conspiracy to commit wire fraud and conspiracy to commit money laundering.

Prince Group TCO’s Global Reach shared by @wublockchain12

Blockchain analysts noted that the massive Bitcoin cache linked to the case has been dormant since 2020. Crypto researcher @tier10k reported that the Bitcoins originated from Chen’s LuBian mining operation. This suggests that someone may have stolen the assets years ago. The DOJ has confirmed possession of the funds. But declined to comment on their precise source. It is fueling speculation across the crypto community.

U.S. Treasury Tightens Sanctions

In a parallel move, the U.S. Treasury Department announced sanctions against Chen Zhi, the Prince Group and its associated entities in Palau. The department accused the organization of benefiting from cyber fraud, money laundering, human trafficking and forced labor. The sanctions include several companies that they linked to Chen. Along with individuals such as Rose Wang, who allegedly facilitated “predatory investments” in Palau. 

The U.S. claims that Chen’s company Grand Legend leased Ngerbelas Island in Palau to develop a luxury resort. That uses local networks as a front for money laundering operations. The sanctions freeze all assets belonging to Chen Zhi and his associates within U.S. jurisdiction. They also prohibit American citizens and businesses from conducting transactions with the group. This effectively cuts them off from the U.S. financial system.

FinCEN and OKX Respond to Money Laundering Concerns

The Financial Crimes Enforcement Network (FinCEN) also issued a report linking Huione Group. Another company associated with Chen Zhi. To over $4 billion in laundered funds between August 2021 and January 2025. This included $37 million tied to North Korean cyberattacks, $36 million from crypto investment scams. Also, connected $300 million to other online fraud schemes.

OKX CEO Star 发文表示，Huione（汇旺）集团在加密资产领域造成了严重的不良影响。鉴于其潜在风险，OKX 已针对涉及该集团的交易实施严格的 AML 管控措施。凡是与 Huione 相关的加密资产充值或提现交易，均将接受合规调查。根据调查结果，OKX 可能采取冻结资金或终止账户服务等措施。

— 吴说区块链 (@wublockchain12) October 15, 2025

As the case drew attention, consequently, OKX CEO Star released a statement. He confirmed that the exchange has implemented strict anti-money laundering (AML) measures targeting any activity linked to Huione. Specifically, all crypto deposits and withdrawals associated with the group will now undergo compliance checks. Moreover, depending on the findings, OKX may freeze funds or terminate accounts involved in suspicious activity.

Blockchain Investigators Step In

Crypto investigator ZachXBT also weighed in. He noted that the wallet addresses linked to the 127,000 Bitcoins were identified in a previous report by Milky Sad. Which flagged vulnerabilities in their private keys. The revelation raised concerns over how those wallets were accessed. Whether the assets were seized directly or through cooperation with intermediaries. 

The Chen Zhi case now stands as one of the largest crypto related criminal prosecutions in U.S. history. With billions in digital assets and multiple nations involved. It underscores how deep and global crypto crime networks have become. Also, how far regulators are now willing to go to dismantle them.