The Bitcoin War Between the US and China: China Arrests Owner of 127,000 Bitcoins. What's Next for the Assets?

January 2026 brought a new twist in the global struggle for control of digital assets. The arrest and subsequent extradition to China of Chen Zhi, the founder of the powerful conglomerate Prince Group, raises the question for the international community: who will ultimately gain access to his colossal Bitcoin reserves, which the US is already laying claim to?

Special Operation in Cambodia: The Shadow of Prince Group

According to the Guangxi International Communication Center and reputable publications such as the Cambodia–China Times, Chen Zhi was detained by Cambodian authorities. The Cambodian Ministry of Interior confirmed the repatriation of three key figures: Chen Zhi himself, as well as his associates Xu Ji Liang and Shao Ji Hui.

Prince Group has long been under the radar of international regulators. Last October, the US and UK simultaneously imposed sanctions against dozens of organizations associated with Chen. The main accusation was the creation of large-scale "fraud centers" that exploited thousands of migrant workers. The US Treasury Department then blacklisted 146 individuals associated with the group's activities.

Billions in Bitcoin: Who Will Get There First?

However, behind the façade of fighting fraud lies a larger interest. Chen Zhi made headlines worldwide not only because of the sanctions, but also because of his cryptocurrency holdings.

In October 2025, the US Department of Justice (DOJ) made a sensational announcement about the confiscation of approximately 127,271 bitcoins, which they believed were controlled by the head of the Prince Group. At the time, the value of this asset was estimated at a staggering $15 billion. This seizure was one of the largest in the history of Southeast Asia and effectively made Chen one of the largest individual holders of BTC in the world.

The Extradition Dilemma and Digital Sovereignty

Now that Chen Zhi has been handed over to Chinese law enforcement, a critical detail has emerged, sparking debate among experts. The US has already claimed these assets as part of a criminal investigation. However, the physical presence of the key owner in China changes the rules of the game.

Beijing is currently silent. The Chinese Ministry of Foreign Affairs and public security agencies have not yet commented on the fate of the extradited businessman and, more importantly, the fate of his digital wallets.

If the US authorities only gained partial control over the assets or "froze" them at the exchange level, then Chen may still have actual access to the private keys. The owner's presence in a Chinese prison gives Beijing powerful leverage in the cryptocurrency "cold war" with Washington.

The situation surrounding 127,000 BTC is becoming more than just a criminal case, but a full-blown geopolitical thriller, with control over 0.6% of the entire Bitcoin supply at stake. Who will ultimately inherit Prince Group's billions will become clear following closed interrogations in China.