China Already Sold 194K Bitcoins Seized From PlusToken: CryptoQuant Chief

CryptoQuant CEO asserts that China might have already disposed of its PlusToken Bitcoin stash.

There have been several scams in crypto’s decade and a half history, but not many as big as PlusToken, a Ponzi scheme that ran between 2018 and 2019 in China and led to the seizure of over $4 billion in crypto, leaving the government with a 194,000 BTC nest egg, or so some have thought.

China Already Sold?

According to Ki Young Ju, CEO of leading crypto analytics platform CryptoQuant, the Chinese government might have disposed of the PlusToken Bitcoin stash almost as soon as it got its hands on it.

In a Thursday, January 23 X post, Young Ju asserted that all 194,000 BTC were sent through mixers and offloaded on exchanges like Huobi in 2019, citing a CryptoQuant chart analyzing the flow of the assets. 

“There’s no point in using mixers and multiple exchanges if they didn’t sell it,” Young Ju stressed. 

He further supports his view, citing a 2022 Valkyrie report based on data from CryptoQuant and prominent on-chain sleuth “Ergo BTC.”

The report asserted that PlusToken’s Bitcoin stash peaked at an estimated 171,000 BTC around August 2019 but quickly diminished to less than 50,000 BTC by December 2019 amid government selling after the seizure. The authors argue that this dump contributed to a Bitcoin price drop experienced during this period.

Specifically, Bitcoin fell from highs above $12,000 in August 2019 to lows near the $6,000 price point in December 2019. 

At the time, Valkyrie described it as the first major indirect liquidity attack on Bitcoin by a government. 

At its peak price, the 194,000 BTC sold by China would have been worth about $2 billion. At the time of writing, however, it is now worth about ten times that figure, about $20.2 billion.

A Positive for Bitcoin Holders?

Some members of the crypto community may see the suggestion that China has already disposed of bitcoins seized from the PlusToken Ponzi as a positive development, eliminating any fear of a looming sell-off driven by the Chinese government in the future.

The government, of course, has yet to issue any official statement to this effect.

The government has adopted a crypto ban in 2021. At the time, some had feared that the move could mean doom for Bitcoin as most miners were domiciled in the Asian economic giant. However, The Bitcoin network proved resilient, with its hash rate quickly bouncing back amid an exodus of miners.