Did China Secretly Sell Seized Bitcoin from PlusToken Ponzi Scheme?

China seized 194,000 Bitcoin from the 2019 PlusToken scam.
Evidence suggests the BTC was sold via exchanges like Huobi.
Historical data highlights the market impacts of PlusToken-era events.

China’s handling of Bitcoin seized during the 2019 PlusToken Ponzi scheme remains under scrutiny, as new evidence suggests the cryptocurrency was sold. Blockchain analysis reveals that 194,000 Bitcoin tokens confiscated by Chinese authorities were likely laundered through mixers and liquidated via exchanges like Huobi.

The PlusToken scam, one of the largest Ponzi schemes in cryptocurrency history, defrauded investors of over $2 billion. While Chinese authorities reported transferring the seized Bitcoin to the “national treasury,” no further disclosures were made about its fate.

Evidence Points to Liquidation

Blockchain data shows significant Bitcoin outflows from PlusToken-associated wallets to exchanges in 2019. These movements coincide with the seizure of the 194,000 Bitcoin by Chinese authorities.

Ki Young Ju, CEO of CryptoQuant, argued the assets were likely sold, noting, “There’s no point in using mixers and multiple exchanges if they didn’t sell it.”

Questions About China’s Bitcoin Holdings

This raises questions about reports indicating that China is among the leading governments holding Bitcoin. If they sold the 194,000 BTC, how much do they still have?

PlusToken’s Impact on the Market

Notably, charts shared by Valkyrie Investments and CryptoQuant show a sharp rise in Bitcoin inflows to exchanges during 2019, correlating with price fluctuations. Analysts believe the liquidation of PlusToken reserves increased selling pressure, contributing to market instability.

Overall, the PlusToken era left a lasting mark on the cryptocurrency market. Metrics like “Bitcoin CoinDays Destroyed,” which tracks the movement of older Bitcoin, spiked in late 2019. These spikes corresponded with intense selling activity, further hindering Bitcoin’s recovery after the 2018 bear market.

History shows that large-scale Bitcoin movements often influence market trends. In 2017, speculative behavior fueled a bubble, while liquidations, such as those tied to PlusToken, worsened subsequent price declines.

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