The Largest Cryptocurrency Seizure in U.S. History

The U.S. Federal Bureau of Investigation has carried out one of the largest operations against international fraud networks in the history of the cryptocurrency market. As part of Operation Blackout, more than 127,000 bitcoins worth over $8 billion were seized, and according to some estimates, the value of the confiscated assets at their peak could have reached nearly $15 billion. This is the largest cryptocurrency seizure ever conducted by the U.S. government.

The central figure in the investigation was Chen Zhi, founder and chairman of the Cambodian conglomerate Prince Holding Group. According to investigators, a transnational criminal organization operated under the cover of a major business enterprise, using heavily guarded compounds across Southeast Asia to force people into fraudulent operations. The schemes involved so-called “pig butchering” scams – long-term investment frauds in which scammers first build trust with victims and then gradually convince them to transfer money into fake cryptocurrency investment projects. In some cases, according to investigators, victims were held against their will and forced to participate in defrauding others.

Operation Blackout combined four major investigations. Operation Zephyr Exodus resulted in the arrest of Chen Zhi and the seizure of crypto assets linked to Prince Holding Group. Operation Sand Dollar targeted criminal networks in the United Arab Emirates, where 275 individuals were arrested in Dubai, while each of the nine dismantled scam centers was estimated to generate approximately $6 million annually.

Operation Haochen targeted the Tai Chang compound in Myanmar, which was linked to the Democratic Karen Benevolent Army, resulting in the seizure of $30 million in assets. Shunda Compound Takedown involved joint actions with Thai authorities and led to the dismantling of Telegram networks used to recruit people into scam compounds.

According to investigators, behind the facade of online fraud operated an industrial-scale forced labor system. Thousands of people were lured with promises of jobs in IT or customer service centers, only to find themselves trapped in secured compounds where they were forced to participate in fraud schemes under threats of violence. In 2025 alone, the Internet Crime Complaint Center received approximately 72,000 complaints related to cryptocurrency fraud, with total reported losses exceeding $7.5 billion. Experts believe the real losses are significantly higher, while the global revenue generated by such networks may reach $64 billion annually.

Another important component of the operation was cooperation with Starlink, which blocked more than 7,000 terminals in Myanmar that were being used by scammers for communications and coordination. At the same time, the Level Up initiative helped identify and warn 8,935 potential victims, 77% of whom were unaware they were being targeted by fraudsters. The estimated financial losses prevented through the program totaled $562 million.

As a result of Operation Blackout, approximately 2,000 victims of forced labor were freed, nearly 300 suspects were arrested, and investigations continue across several countries in Asia, Africa, and the Middle East. Meanwhile, the structure of the criminal enterprise had long evolved beyond traditional organized crime and into an industrialized system featuring management structures, logistics networks, and specialized operational roles comparable to those of a corporation.

Historically, this represents one of the largest Bitcoin seizures ever conducted. In scale, it is comparable to the Silk Road case, when U.S. authorities confiscated roughly 144,000 BTC in 2013. However, the current operation differs not only in size but also in nature – for the first time, investigators uncovered a global fraud network operating as a fully developed transnational industry.

The key question now is whether Operation Blackout will become a turning point that fundamentally disrupts such schemes, or merely a temporary blow to one segment of the global crypto-fraud ecosystem, which has already proven highly adaptable and capable of shifting between jurisdictions.