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Exec of Chinese Blockchain Firm Allegedly Misappropriated $45M in State-Owned Bitcoin: Report
Gao Ziyang has reportedly been detained for the alleged liquidation. The company denied his involvement and has not confirmed the detainment.
Updated Sep 14, 2021, 12:38 p.m. Published Apr 9, 2021, 4:18 p.m.
A 27-year-old executive of blockchain firm Beosin has reportedly been accused of misappropriating $45 million worth of state-owned bitcoins by Chinese authorities.
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According to a report by local media outlet Tencent News on Thursday, Chief Marketing Officer Gao Ziyang allegedly attempted to short the state's bitcoin last year.
The funds were in the company's care after police had seized them in a separate incident. Beosin was charged with holding and converting the bitcoin to fiat on behalf of the Chinese treasury where Gao had access.
Read more: PayPal Co-Founder, Bitcoin Investor Thiel Says Bitcoin Could Be Chinese ‘Weapon’
Rather than sell the funds, it is alleged the executive tried to short the seized bitcoin in August using excessive leverage. At the time, bitcoin was trading between $10,500 and $12,500 before rising to new heights above $20,000 four months later. The erroneous short position ended up liquidating approximately 300 million yuan (US$45.7 million) worth of bitcoin.
The court file released only the last name of the suspect. The company has denied Gao's involvement in the case and has not confirmed his detainment, according to the report. However, the company's CMO can not be reached and his name has been removed from the company's official website after the report.
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