Chinese investors who lost money in a massive fraud case are now challenging a United Kingdom compensation plan linked to 61,000 seized Bitcoin. The dispute has reached the UK High Court, where victims argue that the current redress proposal could prevent them from benefiting from the huge rise in Bitcoin’s value.
The seized cryptocurrency is now worth around £3.2 billion ($4.3 billion) after Bitcoin’s price surged since authorities confiscated the assets during a money-laundering investigation in London.
Victims Fear Losing Bitcoin Gains
Thousands of Chinese investors affected by the fraud are questioning a proposal that would compensate them through a Chinese redress scheme. According to court filings reported by the Financial Times, victims believe this plan could allow British authorities to keep much of the profit generated by the Bitcoin since it was seized.
Law firm Candey, which represents around 5,700 victims, says the proposed compensation process may not guarantee fair repayment. The firm argues that legal action in the UK courts could offer victims a better chance of recovering funds tied to the seized cryptocurrency.
The original investment fraud scheme reportedly operated between 2014 and 2017 and affected more than 128,000 investors in China. After the money was collected, investigators say the funds were converted into Bitcoin and transferred abroad, eventually becoming part of the assets seized by UK police.
However, prosecutors have raised concerns that some legal claims might allow certain victims and litigation funders to recover more than their original losses. Government lawyers argue that this could unfairly benefit a small group while excluding other victims and the British state.
Candey has defended the lawsuit, stating that its legal fees are capped at 18% of any recovered funds, and emphasizing that court proceedings could help ensure victims receive proper compensation.
Bitcoin Seizure Linked to London Mansion Attempt
The Bitcoin involved in the case was seized during a 2018 raid on a London property connected to Jian Wen. Authorities became suspicious after Wen attempted to purchase a luxury mansion in London using Bitcoin but failed to explain where the funds came from.
Wen was later convicted of money laundering, while the alleged mastermind of the fraud scheme, Zhimin Qian, was sentenced by a UK court to more than 11 years in prison in November 2025.
The seized cryptocurrency has since become a major legal and financial issue due to its massive increase in value.
A preliminary hearing scheduled for July will determine whether English or Chinese law should apply to the claims over the Bitcoin. Meanwhile, the High Court has set May 22 as the deadline for victims seeking recovery under Section 281.
