Key Takeaways
- Twelve people charged in $263M Bitcoin theft tied to a Genesis investor.
- Funds were traced by blockchain sleuths, leading to arrests in California and Dubai.
- Defendants allegedly used the stolen Bitcoin to fund lavish spending and continued laundering while in custody.
Federal prosecutors unsealed a superseding indictment Thursday, charging 12 individuals in connection with a global racketeering scheme that stole over $263 million in Bitcoin.
The defendants face charges including racketeering conspiracy, wire fraud, money laundering, and obstruction of justice.
Background on the case
The new indictment builds on the 2024 case against Malone Lam, accused of stealing over 4,100 BTC — worth $230 million at the time — from an early Bitcoin investor and Genesis creditor.
Blockchain investigator ZachXBT worked alongside Cryptoforensic Investigators and zeroShadow to trace the stolen funds, calling the case…
… one of my best … of all time.
Arrests and operations
Several suspects were arrested this week in California, while others are believed to be in Dubai, according to the U.S. Department of Justice.
Prosecutors said the group ran a sophisticated operation between October 2023 and March 2025, with members assigned roles ranging from phishing and hacking to laundering and even physically stealing hardware wallets.
Extravagant lifestyle funded by theft
The stolen assets funded an extravagant lifestyle: $500,000 nightclub outings, $3.8 million supercars, private jets, and luxury items including Hermes Birkin bags.
Lam allegedly continued orchestrating thefts and laundering schemes from pretrial detention.
Origins and methods of the scheme
The scheme reportedly began with online gaming friendships that evolved into a full-scale crypto theft operation.
Authorities said the group used mixers, VPNs, peel chains, and fake identities to obscure transactions across platforms.
Agencies involved
The case is being handled by the FBI, IRS, and the U.S. Attorney’s Office in Washington, D.C.
