- DOJ seized 127,271 BTC linked to Prince Group; many victim claims have been rejected
- Attorneys seek a special victims fund to distribute the assets
- Blockchain timeline shows coins dormant from 2020 until 2024, creating evidentiary questions
- Indictment includes images reporters say are unrelated to alleged crimes
The Justice Department’s seizure of 127,271 Bitcoin linked to Cambodia’s Prince Group has set off a fierce legal battle over who gets paid, and raised pointed questions about how federal prosecutors handle forfeiture proceeds in large-scale crypto fraud cases.
The Bitcoin, valued at roughly $9 billion, was recovered from Prince Group, a Cambodia-based operation that US prosecutors say was controlled by Chen Zhi. According to the DOJ, the syndicate compromised Facebook accounts to lure hundreds of thousands of users into fraudulent cryptocurrency investment schemes.
The US and UK imposed sanctions on Prince Group and Zhi in December, and Zhi was arrested in Cambodia in January 2026 before being transferred to China.
Victims Shut Out as DOJ Dismisses Restitution Claims
Dozens of law firms representing hundreds of alleged victims have condemned the DOJ’s handling of the forfeiture. Attorneys described the agency’s decisions as a “complete and utter rout of every victim who has tried to enforce their lawful rights to recover their stolen cryptocurrency.” Daniel Thornburgh, counsel for multiple claimants, urged the DOJ to place the Bitcoin into a dedicated compensation fund to make restitution payments more efficient.
The department has pushed back hard. Officials said some claimants failed to provide documentation linking their losses to the specific wallets seized by law enforcement.
Others, the DOJ argued, lack legal standing entirely. In certain instances, prosecutors argued that cryptocurrency transfers were voluntary, thereby placing them outside the restitution framework altogether.
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Operation Shamrock founder Erin West has signaled her group will press lawmakers to redirect forfeited crypto assets directly to victims rather than government reserves. Investigators tracking the funds have described the process as “tough and often futile,” citing the sheer volume of money transfer intermediaries through which assets passed.
Evidence Gaps Cloud the Government’s Case
The forfeiture dispute has also exposed cracks in the DOJ’s underlying evidence. Blockchain analysts and defense attorneys flagged inconsistencies in court filings: on-chain data indicates the Bitcoin was stolen in 2020 and sat dormant until being moved across multiple wallets in mid-2024, a timeline that appears to conflict with claims in the indictment.
Image evidence cited in the charges has drawn separate scrutiny. At least one photograph used to characterize Prince Group’s operations lacked a clear link to the alleged crimes, and another was traced to a Flickr post by a user who denied any connection to organized crime.
With forfeiture motions still pending and restitution legislation in early drafting stages, the ultimate destination of one of the largest crypto seizures in US history remains an open question.
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