The compensation mechanism for the 61,000 Bitcoin money laundering case is under scrutiny, and Chinese victims have initiated legal challenges in the UK

Victims of a Chinese investment fraud case are challenging a compensation arrangement involving approximately 61,000 bitcoins in a UK court. Representatives for the victims have filed an application with the High Court of England and Wales to reject the proposal for compensation through the Chinese compensation mechanism, arguing that the plan may allow UK authorities to retain significant asset appreciation gains.

These bitcoins were seized by the UK police during a money laundering investigation in London and are currently valued at around £3.2 billion (approximately $4.3 billion). It is reported that the law firm Candey is representing about 5,700 victims in the objection, claiming that the current compensation scheme fails to ensure fair compensation. The fraud case, led by Qian Zhimin, involves over 128,000 Chinese investors, with the proceeds of the fraud converted into bitcoins and transferred overseas between 2014 and 2017. The UK prosecution has stated that some claims may result in a few victims and litigation funders receiving compensation that exceeds their actual losses.