China Accuses U.S. of Stealing $13B in Bitcoin in Explosive New Dispute

TLDR

• China accuses the U.S. of orchestrating a cyberattack to steal 127,426 Bitcoin worth over $13 billion.
• The Bitcoin was stolen from a Chinese mining pool called LuBian in December 2020.
• The U.S. Department of Justice seized 127,271 BTC in late 2025, linking it to criminal activities by a Cambodian group.
• China rejected the U.S. explanation, claiming the seizure was a move to legitimize stolen Bitcoin.
• The seizure increased U.S. Bitcoin reserves to 325,000 BTC, valued at around $36 billion.

A new dispute has emerged between China and the United States over 127,426 Bitcoin, valued at over $13 billion. China has accused the U.S. of orchestrating a cyberattack in 2020 that resulted in the theft of these Bitcoin from a Chinese mining pool, LuBian. The accusation has sparked a diplomatic conflict, intertwining cybersecurity, finance, and politics in one of the most intense controversies in the crypto market.

China Rejects U.S. Explanation for Bitcoin Theft

In December 2020, a hack targeted the LuBian mining pool in China, leading to the theft of 127,426 BTC. The stolen Bitcoin was valued at $3.5 billion at the time, though no culprit was identified for years. Blockchain experts initially suggested that a technical flaw in the mining pool’s system, such as a “weak-key” vulnerability, could have allowed the theft.

Other experts speculated that an insider could have been involved. Despite these theories, the true cause of the hack remained unclear for a long time. In late 2025, the U.S. Department of Justice (DOJ) announced the seizure of 127,271 BTC, claiming it was linked to criminal activities by the Cambodia-based Huione group. The seizure was described as the largest Bitcoin confiscation in history, valued at over $13 billion.

The U.S. government, however, did not provide detailed evidence of the hack’s origin or the nature of the criminal activity behind the seizure. Officials argued that the confiscation of the Bitcoin was part of a broader effort to combat online scams. The U.S. explained that the coins were connected to a series of cybercrimes carried out by a criminal organization.

However, China swiftly rejected this explanation. The National Computer Virus Emergency Response Centre (CVERC) accused the U.S. government of being the real hacker. According to CVERC, the hack was part of a U.S.-led cyber operation, and the subsequent seizure was a move to legitimize the stolen Bitcoin. The accusations suggest that the U.S. acted as a state-level hacker.

Bitcoin Seizure and U.S. Bitcoin Reserves

Following the seizure, the U.S. government’s Bitcoin holdings increased to 325,000 BTC, worth approximately $36 billion. U.S. officials stated that the move was aimed at protecting investors from online fraud. The seizure further raised concerns about the role of governments in controlling Bitcoin, which is traditionally seen as a decentralized currency.

The growing U.S. Bitcoin reserves have raised questions about the future of crypto regulations. As the U.S. strengthens its control over digital assets, global tensions surrounding Bitcoin’s use continue to rise. In China, the accusations against the U.S. have become a focal point in broader geopolitical discussions.

The ongoing dispute has already begun to affect the Bitcoin market. As tensions escalate between the U.S. and China, Bitcoin’s price has experienced a slight decline. Bitcoin is currently trading at $105,000, down by 0.72% in the last 24 hours. This market fluctuation is partly attributed to fears that the diplomatic standoff could influence crypto regulations and cross-border Bitcoin transfers.

The U.S. Bitcoin and Ethereum exchange-traded funds (ETFs) saw a $755 million outflow this week. Analysts believe that these movements indicate growing caution among traders. However, they also suggest that the long-term impact could benefit Bitcoin’s status as a “digital gold.”

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