China Is Fast Losing Money: Their Bitcoin Stash Just Fell By $388 Million

When Bitcoin prices fell from $31,000 to below $29,000, the total value of BTC held by China fell by over $388 million to around $5,4 billion. 

Bitcoin is trading below $28,500 and looks likely to edge even lower, considering the formation in the daily chart. With every tick lower, China and other countries, including Ukraine and Georgia, are losing money.

The loss could even be bigger for the Chinese considering their big stash of BTC, which translates to around 0.924% of the total fixed supply of 21 million, according to Bitcoin Treasuries data.

Records show that China holds 194,000 BTC, 833,000 ETH, and a variety of other unnamed cryptocurrencies. These digital assets were confiscated from the PlusToken scam in 2019 and were worth over $3 billion.

FUN FACT: Government of China is a crypto whale.

Chinese authorities seized 194k BTC, 833k ETH, and others from the PlusToken scam in 2019. They forfeited these $6 billion-worth assets to the national treasury.

FWIW, MicroStrategy has 130k $BTC. pic.twitter.com/Ilqp7EnenL

— Ki Young Ju (@ki_young_ju) November 2, 2022

According to reports, these assets were tied to the country’s national treasury. Still, some funds associated with the scam are reportedly being regularly sent to mixers and liquidated at spot rates, impacting prices.

However, whether the Chinese government still holds these assets remain unknown. There is no official Bitcoin address to verify the status of these coins.

PlusToken Scam was a global Ponzi scheme targeting Chinese and South Korean investors. It started in April 2018, taking advantage of unsuspecting people who thought they could make quick money from an investment opportunity.

All users had to pay for registration using cryptocurrencies, mainly BTC, before investing. Perpetrators said they were developing cryptocurrency products. 

Six Chinese nationals were arrested in Vanuatu and extradited to China to face the law in June 2019. A year later, the Chinese Ministry of Public Security said they arrested other suspects, recovering over $3 billion of crypto assets.

Cryptocurrency trading and related operations, including mining, are banned in China. Therefore, whether Chinese authorities will “trade” these cryptocurrencies for other assets is unclear for now.

The country outlawed trading in 2017 and mining in 2021, forcing crypto miners, mainly of Bitcoin, to other jurisdictions. Since the ban, the United States has emerged as the biggest host of crypto mining operations. China accounted for over 50% of all crypto mining operations at peak.

According to trackers, the largest public Bitcoin mining companies are in the United States and Canada. Riot Blockchain is the largest publicly listed Bitcoin mining company with a market cap of $1.82 billion.