Chinese man sentenced to 10 years and 9 months for stealing 107 BTC via mnemonic phrase

Huoxing Finance reports that, on June 8, according to Knews, the Supreme People’s Procuratorate disclosed a new type of cryptocurrency theft case on June 7. In Shandong, a man named Zhang long assisted his acquaintance Feng with cryptocurrency transactions. After gaining Feng’s trust, Zhang proactively suggested switching to a more convenient digital wallet. The asset recovery phrase (private key) for such wallets is generated by the system through a random combination of 12 words selected from a list of 2,048 common English words, serving as the core password for securing cryptocurrency. While Feng was writing down the recovery phrase, Zhang memorized 11 full words with his keen eyesight and exceptional memory, and also noted the first letter of the final word. That same night, relying on these fragmented details, he repeatedly tested and combined possibilities until he successfully unlocked Feng’s digital wallet and transferred 107 bitcoins. He later sold the stolen bitcoins for an illegal profit of RMB 660,000. The court ultimately sentenced Zhang to ten years and nine months in prison and imposed a fine of RMB 100,000 for theft.