Silk Road was robbed by James Zhong, 32, of Gainesville and Athens, Georgia a decade ago of more than $3.36 billion in bitcoin (51,351.89785803 bitcoins), which was recovered recently by federal prosecutors. James Zhong is a dreadful hacker and as a result, he has been recently convicted by the US Department of Justice.
Silk Road is one of the most notorious dark web marketplaces in the world where people from all over the world are able to purchase and trade the following things:-
- Illegal drugs
- Illicit goods
- Illicit services
It was reported on Friday, November 4 that Zhong pleaded guilty to several crimes associated with money laundering.
An exploit was found by Zhong on a dark web marketplace that allowed him to withdraw much more Bitcoin than he had deposited on the site due to a processing flaw.
Identifying a flaw in Silk Road’s transactions system, James confessed that he stole 50,000 bitcoins from the market in September 2012 before fessing up to being a fraudster.
James Zhong was a former member of the Silk Road dark net marketplace, and a total of 100,000 members participated in this market between the years 2011 and 2013 when this market operated.
A total of nine different accounts were funded by Zhong using an initial deposit amounting to between 200 and 2,000 bitcoins. After that, he executed 140 withdrawal requests and all these requests were made in a short period of time.
To make these rapid transactions possible, he took advantage of the improper and faulty transaction system of the market. So, with the help of these flaws the hacker fooled the market’s system into releasing more than 50,000 bitcoins.
In order to make all traces as complex as possible, he transferred the funds to a variety of wallets within a short time frame.
Seizure of Bitcoin
Here below we have mentioned the complete list of items that were processed and seized:-
- 50,491.06251844 Bitcoin
- An underground floor safe
- A single-board computer
- $661,900 in cash
- 25 Casascius coins
- Four one-ounce silver-colored bars
- Three one-ounce gold-colored bars
- Four 10-ounce silver-colored bars
- One gold-colored coin
A total of 825.24 Bitcoins were surrendered by Zhong willingly to the authorities in March 2022. Moreover, he surrendered 35.5 Bitcoins more to the authorities in May 2022.
It’s possible for Zhong to face a prison sentence of up to 20 years for pleading guilty to one count of wire fraud in this case.
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