DOJ Seeks Forfeiture of 127,271 Bitcoin Linked to Pig-Butchering Scam, Could Boost U.S. Holdings by 64%

• DOJ seeks forfeiture of 127,271 BTC tied to an international pig-butchering scam.

• The action coincides with U.S. Treasury, FinCEN and U.K. sanctions on the Huione network.

• If granted, the seizure would raise U.S. government BTC holdings to ~324,600 BTC (Arkham Intelligence data).

DOJ seizes 127,271 BTC tied to a pig-butchering fraud — read how the forfeiture could expand the U.S. Bitcoin reserve and what regulators have done next.

Published: 14 October 2025   Updated: 14 October 2025   Author: COINOTAG

What is the DOJ seizure of 127,271 BTC?

The DOJ seizure of 127,271 BTC is a forfeiture complaint filed in the Eastern District of New York seeking control of Bitcoin linked to a large-scale “pig-butchering” scam allegedly run by Chen Zhi, chairman of Cambodia’s Prince Group. The complaint calls the case the largest crypto forfeiture in DOJ history and traces funds through unhosted wallets and payment rails tied to Huione.

How did authorities trace the funds and who is targeted?

Investigators tracked billions in scam proceeds through a combination of on-chain analysis and payment-rail tracing. The complaint identifies a network of unhosted wallets and entities tied to Huione that moved funds internationally. The U.S. Treasury Department and FinCEN announced coordinated measures, and the U.K.’s financial sanctions office issued parallel actions designating related entities for blocking transactions.

Treasury, FinCEN and the U.K. coordinated actions

The DOJ filing arrived alongside sanctions from the U.S. Treasury Department and a FinCEN final rule designating Huione as a foreign financial institution of primary money-laundering concern under Section 311 of the USA PATRIOT Act. The U.K. Office of Financial Sanctions Implementation mirrored those sanctions, restricting British entities from dealing with the same network. Plain-text sources referenced by investigators include official filings from the U.S. Department of Justice and regulatory notices from FinCEN and the U.K. Treasury.

If forfeited, how would U.S. Bitcoin holdings change?

According to Arkham Intelligence data cited in filings, the U.S. government currently holds roughly 197,354 BTC. Seizing an additional 127,271 BTC would increase reserves to around 324,600 BTC — a near 64% rise — valued at approximately $36 billion at the reported price level used in the complaint. The DOJ describes the forfeiture as potentially one of the single largest additions to U.S. crypto holdings.

Source: Arkham Intelligence

The evolving strategy for seized crypto

Historically, federal agencies auctioned seized coins soon after forfeiture. Recent patterns show authorities retaining larger inventories for longer periods, creating what observers describe as a Strategic Bitcoin Reserve. The DOJ filing and public records from prior seizures — including Silk Road and Bitfinex cases — illustrate a trend toward longer custodial periods and selective liquidation, changing how law enforcement’s holdings affect market dynamics.

Frequently Asked Questions

How does the DOJ justify forfeiture of cryptocurrency in cross-border scams?

The DOJ’s forfeiture complaint ties specific wallet addresses and transaction patterns to criminal proceeds and to named defendants. By establishing probable cause that the assets were derived from or used to facilitate fraud and money laundering, the government seeks judicial authorization to seize the coins under existing forfeiture statutes.

Could this seizure materially impact Bitcoin’s market price?

Large custodial increases by a government can influence market sentiment, but actual price impact depends on whether the coins are liquidated. If retained in reserve or auctioned gradually, market disruption is likely limited; immediate, large-scale sell-offs would present greater downward pressure.

Key Takeaways

• Largest DOJ crypto forfeiture: The complaint labels the 127,271 BTC case as the department’s biggest crypto seizure effort to date.
• Coordinated regulatory action: U.S. Treasury, FinCEN and the U.K. imposed sanctions targeting Huione and related networks.
• Strategic reserve implications: If forfeited, the coins would substantially enlarge U.S. Bitcoin holdings; authorities appear to be shifting toward maintaining larger custody balances.

Conclusion

The DOJ’s move to seize 127,271 BTC represents a significant moment in financial-crime enforcement and demonstrates coordinated international regulatory pressure on crypto-enabled money-laundering networks. Citing Arkham Intelligence and official DOJ filings, the action could materially increase the U.S. Strategic Bitcoin Reserve if courts grant forfeiture. COINOTAG will monitor subsequent court rulings and regulatory notices for updates and implications for market custody practices.