Man jailed for 107 Bitcoin theft after memorizing wallet mnemonic

The Licang District People’s Court in Qingdao sentenced a man identified as Zhang to 10 years and nine months in prison and fined him 100,000 yuan after finding he took control of a victim’s wallet and later cashed out more than $97,000. Prosecutors said Zhang transferred 107 Bitcoin after reconstructing a 12-word recovery phrase.

Feng, an acquaintance who had asked Zhang to help cash out 117 Bitcoin in July 2023, wrote down the wallet’s 12-word seed during setup. Zhang memorized 11 of the words and later reconstructed the final word to move 107 Bitcoin out of the wallet. Investigators traced the transactions after Feng discovered the missing coins and reported the theft.

Zhang admitted transferring the Bitcoin but claimed he was “protecting” the assets and had lost money speculating; prosecutors pointed to electronic records showing he converted the assets and realized more than $97,000. China’s blanket measures on cryptocurrency have not stopped courts from treating Bitcoin as property that can be stolen under criminal law.

China, Qingdao

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