The UK High Court has ruled that Chinese law will determine whether victims of the Zhimin Qian investment fraud hold proprietary rights over more than 61,000 Bitcoin currently subject to British civil-recovery proceedings. The October 12 decision determines the governing law but does not award the Bitcoin either to the claimants or to the UK government.
In the official judgment, Mr Justice Turner concluded that the substantive rights underlying the victims’ claims must be assessed under Chinese law. The fraud, investment relationships, payments and acquisition of Bitcoin were overwhelmingly centered in China before Qian moved to the UK. English law continues to govern the procedural machinery of the Proceeds of Crime Act, but it cannot independently create proprietary rights that did not survive under the applicable Chinese law.
The assets include more than 61,000 BTC, currently worth roughly £3.8 billion at recent market prices. They remain under court-controlled recovery arrangements following seizures by the Metropolitan Police beginning in 2018 and additional assets recovered after Qian’s 2024 arrest.
Victims Must Establish Property Rights Under Chinese Law
The litigation centers on applications under Section 281 of the Proceeds of Crime Act 2002. That provision allows third parties to resist civil recovery when they can establish that property targeted by enforcement authorities belongs to them. The Chinese investors must therefore demonstrate a proprietary interest in the recovered assets rather than merely prove that they suffered losses in the underlying fraud.
The court considered several theories advanced by the applicants, including contractual rescission, constructive trusts and statutory tracing. Turner rejected attempts to use English equitable rules to bypass the applicable foreign law, concluding that the relevant rights arising from the original transactions are governed by Chinese law regardless of how the claims are characterized.
That conclusion reflects the geography of the scheme. The agreed facts state that the fraudulent investment programs were designed and operated in China, investors paid through Chinese banks or in cash inside China, and more than 100,000 BTC were purchased through a Huobi account before Qian left the country. The later movement of Bitcoin into England did not retroactively change the law governing whatever ownership rights investors may originally have retained.
The underlying scale also requires careful treatment. The judgment records approximately RMB 40.23 billion in investor funds between 2014 and 2017 and at least 128,409 investment contracts, while explicitly stating that it is not yet known whether the contract count equals the number of individual victims. Around RMB 34.1 billion was also repaid through the schemes during that period.
£3.8 Billion Bitcoin Ownership Remains Undecided
The ruling creates an additional legal hurdle for the Section 281 applicants, but it does not establish that the UK Treasury is entitled to retain the Bitcoin or that victims have lost their claims. The next substantive stage must examine what rights Chinese law actually gives individual applicants and whether those rights satisfy the requirements of the British civil-recovery framework.
That distinction is important because seizure, custody and final ownership are separate legal stages. Similar questions arise whenever governments take control of digital assets, including debates over whether confiscated Bitcoin should become part of sovereign reserve holdings or remain subject to restitution and forfeiture processes.
The same separation applies to asset recovery more broadly. Criminal investigations may trace and secure cryptocurrency linked to international fraud or laundering, as seen in cases involving cryptocurrency laundering and subsequent criminal forfeiture, without automatically resolving competing claims from victims, governments or other parties.
Reports indicate that lawyers representing the Chinese applicants intend to challenge the choice-of-law ruling, although the published judgment itself does not record a completed appeal. Until any appeal and the subsequent Chinese-law analysis are resolved, the ultimate disposition of the 61,000-plus BTC remains open.
The October decision therefore narrows the legal framework without settling the multibillion-pound ownership dispute. Its immediate consequence is that the victims’ recovery claims now depend on establishing enforceable proprietary rights under Chinese law before the English court can determine whether any portion of the seized Bitcoin belongs to them.