James Zhong sentenced to jail for 50,000 Bitcoin robbery
According to recent US Attorney reports, James Zhong, a computer science graduate, was sentenced to a 1-year jail term for robbing 50,000 Bitcoin from Silk Road, an infamous dark web marketplace in 2012. It is believed that during the time of the heist, the value of Bitcoin was estimated to be around $620,000. However, even after nearly a decade since the incident occurred, the case still remains shrouded in mystery.
It is reported that James Zhong was 22 years when he identified the software flaw on the underground website while acquiring cocaine. Silk Road was dubbed the ‘Amazon’ of the underworld, as it enables users to purchase items such as illegal drugs and illicit goods. Silk Road is widely acknowledged due to its great level of anonymity and safety.
According to US Attorney Damian Williams, Zhong engaged in fraudulent behavior by utilizing multiple accounts to deceive the market into releasing Bitcoin into said accounts. In addition to setting up many accounts to trick the market, Zhong used mixers to obscure the Bitcoin transactions and lessen their traceability. However, he didn’t spend any of the Bitcoin to make purchases on the website.
Moreover, news reports indicate that in November 2021, the United States authorities obtained a search warrant to search the residence of Zhong. During the search, law enforcement officials discovered and seized a significant amount of assets, including over 50,000 Bitcoin, which was found in an underground floor safe. Additionally, they confiscated more than $660,000 cash, silver and gold bars, and a single-board computer.
As stated by the prosecutors, Zhong had spent $16 million on luxurious hotels, Lamborghini, nightclubs, and real estate investments prior to his seizure. Nonetheless, his lawyers argued for a reduced sentence by sharing his difficult circumstances. They disclosed that he had autism spectrum disorder and lacked companionship, which resulted in his immersion in the world of computers.
In court, Zhong expressed shame and remorse, claiming that he was aware his actions were unethical. He pleaded that he believed that engaging in hacking activities gave him a sense of direction. Subsequently, he surrendered extra belongings and a large sum of money amounting to $42.7 million. He added an allegation that an unknown individual stole a silver briefcase containing $400,000 in cash.