The U.S. government may increase its cryptocurrency reserves by $14 billion through asset seizures.

Amid the turbulent landscape of the crypto market, the United States government has once again unleashed a “crypto storm” that could have a global impact. According to latest reports, the US judicial authorities plan to confiscate up to $14 billion in Bitcoin reserves if the defendants in a case involving a Cambodian company are convicted. This could become the largest government-led seizure of crypto assets in history, and it also raises questions about the delicate relationship between states and cryptocurrencies. From law enforcement to asset management, from regulation to potential market effects, this incident undoubtedly adds new uncertainties and possibilities to the current trends in Bitcoin and related policies.

The U.S. Federal Court has filed a criminal indictment related to a massive cryptocurrency fraud scheme. This case could lead to the government adding $14 billion to its national Bitcoin reserves.

In a notice released by the Department of Justice on Tuesday, authorities announced that they had filed for the confiscation of 127,271 Bitcoins, valued at approximately $14.4 billion at the time of the announcement. These Bitcoins are related to the prosecution of Chen Zhi, the founder and chairman of a Cambodian company that was accused of orchestrating a cryptocurrency investment scam known as the “piggy bank scam.”

There is also a civil request for the confiscation of 127,271 Bitcoins. Source: New York District Court, U.S.

On the same day the indictment was made public, the Office of Foreign Asset Control (OFAC) of the U.S. Treasury Department imposed sanctions on Zhi’s company, Prince Holding Group, and its affiliated companies.

According to the application, the United States will seek to confiscate the bitcoins after Zhi is convicted in the Federal District Court for the Eastern District of New York. He faces charges of telecom fraud conspiracy and money laundering conspiracy in that court. The Department of Justice stated that these bitcoins were “currently held by the U.S. government during the criminal proceedings.” If approved by the court after Zhi is convicted, the confiscation of the bitcoins would represent one of the largest seizures of cryptocurrencies since the establishment of the U.S. strategic reserve. President Donald Trump established a national bitcoin and cryptocurrency reserve through an executive order in March. It is reported that some of the proceeds from the cryptocurrency program have been used to purchase “watches, yachts, private airplanes, vacation homes, high-end collectibles, and rare artworks.” As of Tuesday, Zhi remains at large. If convicted, he could face up to 40 years in prison. Since Trump issued the executive order to establish a strategic BTC and digital asset reserve for the U.S. government in March, the reserve has grown to include approximately 198,000 bitcoins, valued at over $22 billion at the time of the announcement. The confiscation of more cryptocurrencies in the case of Zhi could result in a total reserve of approximately 325,000 BTC, worth $36 billion at current prices. In addition to the cryptocurrencies confiscated through civil proceedings and criminal cases, some White House advisors and lawmakers have proposed alternative methods of adding assets to the U.S. reserve.In November, Sen. Cynthia Lummis from Wyoming suggested that the government could convert part of its gold reserves into Bitcoin. The United States holds over 8,100 metric tons of gold in facilities like Nokesburg. However, it is currently unclear whether Trump’s executive order grants the government the authority to purchase Bitcoin or other tokens by selling other assets. Some advisors, including Treasury Secretary Scott Bessent, recommend using a budget-neutral method to purchase Bitcoin, but this may require congressional approval.

According to Nansen data, as of the time of publication, the price of Bitcoin was $112,738.