A UK Judge Says Chinese Law Decides Who Owns 61,000 Seized Bitcoin. Being Owed Money Is Not Owning the Coins

What Happened

Mr Justice Turner of the High Court in London handed down judgment on Monday, October 12, in Director of Public Prosecutions v Zhimin Qian & Anor, [2026] EWHC 2509 (KB), on a single preliminary question: which country's law governs whether the victims of Qian's Chinese investment fraud have property rights in the roughly 61,000 bitcoin the Metropolitan Police seized from her in 2018.

The answer was Chinese law, and the judge found it was the same answer whether the analysis ran under the Rome I and Rome II regulations or the common law rules of private international law. The contracts were signed in China, the money was paid in China, and the bitcoin was bought in China, much of it through an account at the exchange Huobi; in the judge's words, as reported by the Financial Times and others, 'the relevant damage occurred in China.'

The coins' later arrival in England did not change that.

The ruling settles which law applies and nothing else. According to Caixin, which obtained the judgment, the judge rejected the 4 bases on which the claimants argued for English law and a fallback that English law should apply until Chinese law was proved, but he left open what Chinese law says, how it must be proved, and how it applies to each claim.

Fieldfisher, the claimants' lead firm, has said it will appeal, and the Crown Prosecution Service (CPS) said a further hearing will determine whether any victims can establish an interest in the bitcoin. The scale, from the judgment as reported: investors paid about RMB 40.2 billion, roughly £4.

1 billion, into Qian's Tianjin Lantian Gerui scheme, about RMB 34.1 billion was paid back out, and the court is not yet sure whether 128,409 counts victims or contracts. About 16,000 have joined the English proceedings, per Caixin.

The court did not decide who owns the coins. It decided that the law of the place where they were bought will, and that being owed money is not the same as holding the keys.

Being Owed Is Not Owning

The choice of law decides so much because of the test the victims have to pass. They claim under section 281 of the Proceeds of Crime Act 2002, which shields property that 'belongs to' someone other than the wrongdoer from a civil recovery order. The courts read 'belongs to' as a proprietary interest in the specific property, not a debt owed by the person who took it.

Turner J applied the line from National Crime Agency v Robb, a 2014 fraud case: section 281 creates no broader compensation scheme, so a claim as a creditor for the money paid in is not enough. The claimants wanted English law because its tracing rules would let a fraud victim follow her yuan into the coins they bought.

Whether a Chinese investor ever acquired a property right in coins bought with her money is now a question of Chinese law, and no evidence on Chinese law has been heard.

What Chinese law will say is contested, and the reporting has run ahead of the court. A September 2021 notice from the Supreme People's Court, the People's Bank of China, and 8 other state bodies declared virtual currency business activity illegal and said investment and trading in it is not protected by law.

Chinese courts have since mostly left investment losses where they fell while still, in several reported cases, treating the coins themselves as ownable virtual property. Caixin reads the combination to mean the victims may be limited to principal plus interest rather than a share of the gains.

That is an inference about the next hearing, not a holding of this one. The skeptical reading deserves space too: the judge applied an orthodox rule, the law of the place of the damage, and a Beijing court asked the mirror question about coins bought in London would likely answer the same way.

The ruling is not a finding that the victims lose. It is a finding that the law of the place where they were defrauded, which bars what they did, will decide what they own.

The Custodian Is the Crown

The other party to the case is the state that holds the keys. The Met began investigating in 2018 after a tip about criminal assets moving into London; the trail, per the CPS, began when Qian tried to buy 3 London properties worth £40.5 million and failed know-your-customer checks.

The CPS put the bitcoin's value at the time above £300 million. Qian pleaded guilty at Southwark Crown Court on Monday, September 29, 2025, to 2 offences under the Proceeds of Crime Act and was sentenced on Tuesday, November 11, 2025, to 11 years and 8 months. The coins have been in the Crown's custody for about 8 years, through a rise from under $7,000 to about $83,000 per coin, and nobody has yet established that they own them.

The state's intentions are on the public record in pieces. The Telegraph reported in July 2025 that the Home Office was working with police toward a sale, and a £40 million tender for a system to store and sell seized crypto, re-issued in February 2026 after drawing no acceptable bid, is the rail any sale would run on.

The Financial Times reported that the Treasury was told not to count any proceeds, and in March that the victims had asked the court to reject a government-backed plan to route compensation through a Chinese redress scheme, which they said would leave the gains with the UK. The state has lost seized coins before: in July 2025 former National Crime Agency officer Paul Chowles was jailed for 5 and a half years for moving 50 of the 97 bitcoin his own team had seized from Silk Road 2.

0's operator through a mixer in 2017, a theft that went unexplained for 5 years. If the claims resolve to principal, about RMB 6.1 billion of what was paid in was never returned, around £640 million at the time, and the Crown keeps most of a £3.8 billion position it acquired by seizure.

That is how civil recovery works, and the ruling makes it more likely.

What This Means for You

Start with the distinction the case turns on, because it is the same one that decides what you have when a custodian fails. Section 281 asks whether the property belongs to you, and a claim for money owed does not count. A balance at an exchange is a claim for money owed: FTX's customers spent 2 years learning that they were unsecured creditors of a company, not owners of coins.

Private keys you hold are a proprietary interest by construction; there is no counterparty, no commingled pool, and no tracing exercise. Self-custody does not make you seizure-proof, and this case is a reminder that a state with a warrant and your devices can hold your coins for 8 years.

What it does is put you on the right side of the line the court drew: owner, not creditor.

The second lesson is about jurisdictional contact points. The judge did not care where the coins were. He cared where the contracts were signed, where the money moved, and where the purchases happened. For a holder, each venue you touch can be a contact point of that kind: the exchange you bought on and where it is licensed, the bank that sent the fiat, the country you lived in at the time.

If your coins are ever caught in someone else's seizure, an exchange collapse, or a custodian's insolvency, the court holding them will ask the same questions, and the law of a place you may never have thought about will decide what you own. The practical step is records: dated proof of purchase, the on-chain receipt, the exchange statement, the withdrawal to an address you control.

The victims here must prove ownership of specific coins 9 to 12 years after they paid in. The ones who can will be the ones with paper.

The third is about time. Nothing here is final; the appeal and the individual claims could run into 2027 and beyond, and the coins will sit in Crown custody throughout. That is the structural fact of seized property: the custodian sets the timetable, and its incentives are not the claimant's.

Size your exposure to any custodian, private or sovereign, as a position you might not see for a decade, and keep the coins you intend to keep behind your own keys, where the first question a court must answer is whether you are the person it has a warrant for, not which of 128,409 claimants you are.

What to Watch

The appeal comes first. Then the next High Court hearing, where expert evidence on Chinese law is heard and the question Caixin has already answered, principal or coins, is actually decided. Watch the Home Office's storage-and-realisation procurement, which has to exist before any sale.

Watch whether the China redress plan returns in a form the court can accept, and how Beijing, which has pressed for restitution to the investors, responds to a judgment that hands its law the deciding role. The number that matters most to the Treasury is the gap between about £640 million in unreturned principal and a £3.

8 billion position.

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