The Hidden Narrative Behind the Big Pump of ZEC: The Refugee Migration of Chen Zhihe and Qian Zhimin

Written by: Wenser, Odaily

The U.S. government shutdown has finally come to an end amidst widespread attention, but market sentiment has not improved.

The cryptocurrency market not only did not welcome the expected “bad news fully priced in” rebound but continued to be dominated by bearish sentiment: BTC once fell below the $90,000 mark, ETH briefly dropped below $2,900, and the phrase “all coins down” has almost become a commentary on the current market situation. The only exception is the privacy sector represented by ZEC, which has notably created an impressive independent market performance.

At the same time, two major cases that have stirred the industry are unfolding simultaneously: 127,000 BTC held by Chen Zhi, the spokesperson of the “Prince Group”, has been confiscated by the U.S. government; Qian Zhimin, the mastermind behind “Blue Sky Ge Rui”, who had been on the run for 7 years after illegally raising over 40 billion yuan, has been captured, and the fate of his over 60,000 BTC assets remains unresolved.

Behind the two incidents, a domino effect has been triggered—Bitcoin's censorship resistance and anonymity are facing unprecedented scrutiny from tech geeks, fundamentalists, and even mysterious gray market whales.

When the authoritarian powers of the real world collide with the ideals of decentralized technology, the outcome is not romantic, and it leads idealists to reflect: from the perspective of the ultimate ownership of BTC assets, it is the state machinery that emerges as the final winner.

This also forces the crypto industry to confront an old problem: if BTC also struggles to take on the role of “anti-censorship currency,” then who will be the next symbol of privacy rights and on-chain asset storage? The market's answer may already be emerging — ZEC, which is currently rising against the trend at this point in time, is becoming that suitable “version answer.”

The significant surge of ZEC may not be a manipulation tactic by the whales, but rather a genuine long-term market demand backed by real capital from the big players. This conclusion is supported by multiple narratives and data dimensions.

When the authoritarian government's big hand crushes the illusion bubble of “anti-censorship currency”: BTC is no longer a noble “safe haven” asset.

One of the direct reasons for the belief in ZEC as a “privacy token” is the hidden information revealed by the recent two major “BTC large asset cases”: the censorship resistance and anonymity of BTC are facing severe tests.

First, let's talk about the case involving the “Prince Group” spokesperson Chen Zhiyi, with funds amounting to 15 billion USD.

The judicial and intelligence agencies have fully demonstrated a process for the disposal of on-chain assets: on-chain positioning → financial blockade → judicial takeover. This is a practical closed loop that seamlessly connects “on-chain tracking capabilities” with “traditional judicial power:”

Step 1: On-chain Tracking - Locking Down the “Funding Container”. The anonymity of Bitcoin is often misunderstood. In fact, its blockchain is a public ledger, with every transaction leaving a trace. The Chen Zhi Group attempts to launder money through the classic “Spray - Funnel” model: dispersing funds from the main wallet to a vast number of intermediate addresses like a watering can, and after a short stay, re-aggregating into at least a few core addresses like streams converging into a river. This operation seems complex, but from an on-chain analysis perspective, the frequent “Disperse - Aggregate” behavior instead creates unique pattern characteristics. Investigative agencies (such as TRM Labs, Chainalysis) utilize clustering algorithms to accurately map out the “Funding Reflow Map”, ultimately confirming that these seemingly dispersed addresses all point to the same controlling entity - the Prince Group.

Step 2: Financial Sanctions - Cutting off “Monetization Channels”. After locking down the on-chain assets, U.S. authorities initiated dual financial sanctions: Treasury Department (OFAC) sanctions: listing Chen Zhi and related entities, prohibiting any U.S.-based institutions from transacting with them. Financial Crimes Enforcement Network (FinCEN) §311: designating key entities as “Primary Money Laundering Concerns”, completely severing their access to the U.S. dollar clearing system. At this point, although these Bitcoins can still be controlled by private keys on-chain, their most important value attribute - the “ability to be exchanged for U.S. dollars” - has been frozen.

Step Three: Judicial Takeover - Completing “Ownership Transfer.” The final confiscation does not rely on violently cracking the private key, but rather law enforcement directly takes over the asset's “signature authority” through legal procedures (such as court orders). This means that law enforcement successfully obtained the mnemonic phrase, private key, or controlled hardware wallets, allowing them to initiate a valid transfer transaction just like the original owner of the asset, transferring Bitcoin to a government-controlled address. However, in the Chen Zhi case, the U.S. government has not publicly disclosed the specific methods used to obtain the private key, leading the community to speculate, based on previous reports of security vulnerabilities at Lubian.com, that law enforcement utilized this vulnerability to crack the private key. At the moment this transaction is confirmed by the blockchain network, “legal ownership” and “chain control” are unified.

The ownership of these 127,271 BTC has officially transferred from Chen Zhi to the U.S. government in both technical and legal senses. This set of moves clearly indicates that “on-chain assets are inalienable” is not absolute in the face of national power.

150 billion USD BTC asset transfer process

This matter was subsequently explained in detail in the “Technical Source Analysis Report on the LuBian Mining Pool Hacking Incident and the Theft of Huge Amounts of Bitcoin” published by the National Computer Virus Emergency Response Center. This incident, described as “the most significant virtual asset confiscation operation in history,” is actually a “typical 'black eat black' incident orchestrated by a national-level hacking organization.” In the crypto world, which resembles a dark forest, there are not only groups like the Lazarus Group, known as the 'North Korean national team,' but also the 'American team,' acting as 'on-chain special forces,' quietly lurking in the shadows.

Compared to the steady progress of Chen Zhi, the spokesperson of the “Prince Group” in Southeast Asia, the experience of Qian Zhiming, the protagonist involved in the money laundering case of 60,000 BTC, is even more legendary and tortuous.

According to Caixin, it was first aware of Bitcoin in 2012, “its ambition is to one day hold 210,000 Bitcoins, accounting for 1% of the total Bitcoin supply.” And she almost achieved this goal: from June 2014 to June 2017, over a period of three years, Qian Zhimin instructed her “front person” to successively purchase 194,951 BTC, with an average purchase price of only 2,815 yuan per coin (statistical criteria unknown). On the day she was sentenced in the UK this November, the price of Bitcoin had inflated 266 times to 750,000 yuan per coin.

Qian Zhimin's diary written between May and July 2018 shows that she formulated a “six-year plan” for 2018 to 2023, with the core goals of “retiring at 45” and “rebuilding the digital empire.” She required herself to “at least maintain three identities,” including Saint Kitts and Nevis and “two European countries (at least one of which is not known to others but allows for free travel in Europe),” while also arranging for two long-term leased “safe havens” in Europe.

To support the above arrangements, she pegged almost all large expenditures to Bitcoin. In her diary, she wrote that in 2018, based on a calculation of “about $6800 each,” she planned to sell at least 4000 Bitcoins for immigration, buying a house, and forming a team; in 2019, assuming the price rose to “$8200,” she would sell no more than 1500; by 2020, she further raised the budget price to “$9500,” reserving about 1750 for investment in trading platforms and managing various “interpersonal relationships.” She bet in her diary that after entering 2021, the coin price would remain at $40,000 to $55,000 each for a long time, planning grand projects such as “digital banks,” “family funds,” and building her own kingdom based on this premise.

Qian Zhimin Case Node Description Diagram

In the second half of 2016 to 2017, Qian Zhimin stored over 70,000 Bitcoins in a laptop wallet. (Odaily Note: An additional over 120,000 BTC information has not been further disclosed. A diary seized by the British police recorded that Qian Zhimin once wrote “lost 20,008 BTC”). Combining the information that the total amount of Bitcoin he “circulated, transferred, and exchanged” during his time in the UK was over 18,833, the final amount of BTC seized by the British police was around 61,000, along with BTC and XRP tokens worth £67 million.

The key to Qian Zhimin's eventual capture was the suspicious wallet addresses monitored by the British police through money laundering investigations, combined with the KYC information from Binance which exposed on-chain and off-chain behavioral trails of Qian Zhimin's associates, such as “Seng Hok Ling” (phonetic: Lin Chengfu). In April 2024, Qian Zhimin was arrested in his sleep at an Airbnb apartment in Yorkshire, England.

This also reiterates that assets can exist based on the blockchain of the digital world, but ultimately, humans cannot live outside the physical world. The off-chain space is indeed under the jurisdiction of authoritarian governments.

Imagination VS Reality

The two incidents involving a total of more than 180,000 BTC have led the market to re-examine the real boundaries of Bitcoin's narratives such as “anti-censorship” and “anonymity.” Of course, in reality, with the launch of BTC ETFs, deep participation from institutional funds, and further regulatory demands for transparency in crypto assets, the narrative of Bitcoin, which initially centered on anonymity and anti-censorship, has gradually faded from the mainstream stage.

And ZEC, which holds high the banner of “POW privacy tokens,” has become the “new Canaan” in the eyes of many Bitcoin OGs, Bitcoin fundamentalists, and tech geeks.

Privacy BTC is dead, privacy coin ZEC should rise: the market is repricing “new safe haven assets”

If ZEC's “second spring” relied on the open support of crypto giants like Naval, 0xmert, Arthur Hayes, and Ansem during the early phase of its rise from $60 to over $100, after consecutively surpassing the milestones of $200, $400, and $700, its market buying power has long shifted from short-term speculative hot money to Bitcoin OG whales and Bitcoin fundamentalists, who possess genuine privacy needs.

ZEC price trend in the past month

Specifically, ZEC, which focuses on the concept of “privacy tokens,” has the following advantages:

Firstly, it is the ample liquidity obtained based on mainstream CEX. According to information from Coingecko, as of the time of writing, ZEC's trading volume in the past 24 hours exceeded 2.26 billion USD, with Binance and Coinbase ranking as the top 2 in terms of 24-hour trading volume, the former accounting for over 33% of the total volume; the latter's volume accounts for nearly 11%. In the current market where liquidity is scarce, such a unique “CEX ecological niche” provides a sufficiently large stage for ZEC to attract funds and achieve counter-trend growth.

Secondly, it is based on the real market demand for its differentiated “anonymous privacy pool” (Shielded pool). Data shows that the total amount of tokens in Zcash's (ZEC) privacy pool (Shielded Supply) once approached 5 million on November 3; as of the time of writing, this figure still remains above 4.82 million, accounting for about 30% of the total circulation; the number of transactions on-chain within 24 hours exceeded 26,000; the number of shielded transactions within 24 hours exceeded 2,200. This indicates that the real adoption data of ZEC is very stable and active.

Thirdly, it has a relatively stable token circulation and a smaller market capitalization compared to other mainstream tokens. According to Coingecko data, the total circulation of ZEC is nearly 16.4 million pieces, with a total market capitalization of around 11 billion dollars, ranking 16th in the cryptocurrency market capitalization list; excluding stablecoins and wrapped tokens like USDT, USDC, stETH, wstETH, WBTC, its market capitalization ranks 11th, which has a larger upside potential compared to other mainstream coins with market capitalizations often in the hundreds of billions or even over a trillion dollars.

Fourth, its compliance is more complete, and it faces less regulatory pressure. Unlike controversial privacy tokens like XMR and DASH, which have been embroiled in lawsuits, ZEC, as a mainstream privacy POW token, has no direct conflict with regulatory bodies, and its POW mechanism also ensures a stronger resistance to censorship to some extent. Combining this with the roadmap released by ZEC's development organization Electric Coin Co. (ECC) for the fourth quarter of 2025, ZEC possesses certain technical advantages. Additionally, compared to XMR, ZEC's optional privacy modes provide institutions with the space to maintain compliance and reporting, making ZEC an asset acceptable to regulatory authorities.

Fifth, it is the longstanding ecological position of ZEC and the community's advantage characterized by a strong geek culture and technical atmosphere. As the birthplace of ZK-Rollup technology, the ZEC community includes many tech leaders, crypto OGs, and well-known angel investors, including the highly active crypto KOL Cobie (who claimed to have held ZEC since 2016) and Gemini co-founder Tyler Winklevoss (who stated in 2021 that ZEC is “the most underrated cryptocurrency”).

Considering the above 5 major advantages, ZEC naturally becomes the preferred target for many BTC holding whales, purists, and advocates of censorship-resistant assets for “sensitive asset migration.” This can also be corroborated by multiple data points.

Analysis of the trading dimension of ZEC market performance: From real adoption driving to the mainstream focus of the market.

In the previous article “Buying ZEC to Crash BTC? The 4 Major Industry Truths Behind the Surge of Privacy Coins” (), we conducted a detailed analysis of the possible reasons for the recovery of the privacy token sector. The data performance of ZEC during this month's increase also once again proves that its main driving force for rising lies in the combined effect of market sentiment and real adoption, rather than manipulation by whales.

ZEC is the contract concentrated holding target: 24-hour trading volume only second to BTC and ETH.

According to Coinglass data, the total liquidation amount for ZEC in the past 24 hours exceeded 72.88 million USD, with short liquidations exceeding 69.30 million USD. The liquidation volume of this cryptocurrency in the past 24 hours is only second to ETH and BTC.

ZEC became the “contract liquidation leaderboard runner-up”

In addition, the recent trading volume and open interest of ZEC contracts have remained high: as of the time of writing, the 24-hour trading volume exceeded 6.6 billion USD; the 24-hour open interest exceeded 1.2 billion USD.

ZEC contract data is far ahead.

In terms of spot trading, ZEC has consistently maintained a net inflow status on mainstream CEXs: in the 50 days from October 1 to now, ZEC has only experienced 15 days of net outflow in spot trading; within 30 days, ZEC's spot net inflow is approximately 316 million USD; within 50 days, ZEC's spot net inflow is approximately 419 million USD. In the last 24 hours, ZEC's spot trading volume on Binance exceeded 720 million USD, with a 24-hour increase of over 21%; on Coinbase, the spot trading volume exceeded 230 million USD, with a 24-hour increase of over 17%.

ZEC Spot Inflow and Outflow Data Statistics Chart

ZEC Spot Trading Heatmap and 30-Day Trading Data

The price changes of ZEC: from BTC's trading volume to the market's enthusiastic pursuit.

Apart from the overall trading volume perspective, from the trading volume level of BTC trading pairs, we can also see the 2 major stages that ZEC has experienced:

First, before November 7, the overall trading volume of BTC showed a gradual upward trend. On that day, after the price of ZEC broke through 700, reaching a new high for the year, the trading volume of BTC pairs once exceeded 110. At this time, among the overall buying pressure of ZEC, there were still quite a few transactions buying and selling ZEC with BTC.

Secondly, after November 7, ZEC became one of the few hot targets in the declining market. Coupled with the previous incidents of the “Chen Zhi Case”, “Qian Zhiming Case”, and the net outflow of BTC ETF, market attention gradually shifted to the stage of widespread enthusiasm.

ZEC/BTC trading pair K-line trend

Looking back at ZEC after the slow rise in October, as we enter November, the upward curve of ZEC is undoubtedly steeper. This is influenced by the overall market trends, and it also highlights that ZEC still possesses objective advantages such as real use cases and significant capital capacity.

Especially after the first week of November, following a series of concentrated news events, the privacy attributes and censorship resistance of BTC have come under further scrutiny in the market; conversely, the “privacy coin attributes” of ZEC have once again received high recognition in the crypto market.

In the second week of November, discussions on the X platform regarding “BTC no longer private” became rampant. On November 14, a long article published by Simon, a member of the Delphi Digital team, concluded that “ZEC has taken over BTC to become a value storage medium with privacy and self-determination.”

As a result, after more than a month of development, ZEC has officially become the mainstream narrative in the industry amidst a downward trend in the sector. Many traders who previously sold off their ZEC holdings at 300 USD and 400 USD are now buying back in large quantities, resulting in the first wave of “collective consensus buying.” The characteristics of the market at this time are mainly reflected as follows:

• ZEC's average daily increase has repeatedly maintained at 20–30%, ranking among the top in the CEX increase list;

• Multiple crypto OGs have clearly stated that “BTC's privacy is dead, ZEC is the rightful privacy token,” including BitMEX co-founder Arthur Hayes. On November 7, he publicly stated that ZEC has now become the second largest liquidity holding in his family office fund Maelstrom Fund's portfolio, second only to BTC. On November 16, he even began to launch a “meme creation community activity” to continue to highlight the activity level of the ZEC ecosystem, saying “the Christmas gift I want the most is ZEC.”

• Tokens in the privacy sector such as XMR and DASH have seen a slight increase.

• A series of natural buy orders appeared on the order books of CEXs such as Binance, Coinbase, and OKX.

Even the search volume for “Zcash” and “ZEC” on Google Trends saw a surge of 200%–300%; more importantly, the market demand, emotional hotspots, and active trading of ZEC have attracted high attention from the capital market. As mentioned earlier, Gemini co-founder Tyler Winklevoss contributed a significant amount of buying power with real funds.

ZEC Treasury Company Established: The goal is to purchase at least 5% of the tokens.

On November 12, Nasdaq-listed company Leap Therapeutics announced the purchase of 203,775.27 ZEC tokens at an average price of $245 per token and announced its transformation into a ZEC treasury company, which has been renamed Cypherpunk Technologies Inc. Additionally, the company announced it has secured $58.88 million in private funding led by Winklevoss Capital.

On November 18, Cypherpunk Technologies Inc. (Nasdaq: CYPH) announced that the company has once again invested 18 million dollars to purchase 29,869.29 ZEC (Zcash), with an average purchase price of 602.63 dollars. Including the previously purchased ZEC for 50 million dollars, Cypherpunk's total ZEC holdings have now reached 233,644.56 ZEC, with an average holding cost of 291.04 dollars.

This acquisition brings the company's total ownership percentage in the Zcash network to 1.43%. Cypherpunk focuses on privacy and self-sovereignty, viewing Zcash as a “form of digital privacy asset” and a hedge against the transparency of Bitcoin and its financial infrastructure, especially in an AI-rich future. Previously, the company appointed Will McEvoy, head of Winklevoss Capital, as Chief Investment Officer (CIO) and board member. Winklevoss Capital led a $58.88 million private placement for the company. The goal of the company is to eventually hold at least 5% of the total ZEC supply, continuing to advance its Zcash-centric digital asset treasury strategy.

Can ZEC become another cryptocurrency that attracts significant investment from Wall Street capital institutions and crypto investors after BTC? As the value of ZEC continues to be discovered, it may receive widespread attention.

Conclusion: Is ZEC the “BTC Privacy Insurance”? Perhaps it's much more than that.

Of course, we are not encouraging investors to buy ZEC at a high price. What we present is an objective analysis based on public data, market structure, and demand — from a longer-term perspective, the long-term trend of ZEC may still have room for continuation.

In the article “Why Naval Says: Zcash is Insurance Against Bitcoin Privacy?” (), Max Wong from IOSG Ventures provides a detailed explanation of the rise of ZEC and the underlying technological principles. The core point is the statement made by the well-known Silicon Valley investor Naval when he first “endorsed” ZEC: “Bitcoin is insurance against fiat currency; Zcash (ZEC) is insurance against Bitcoin.”

Today, in addition to being exchangeable with BTC and filling its privacy gap, ZEC is gradually taking on the new narrative expectation of “being the censorship-resistant asset that takes over Bitcoin” in the eyes of some market participants.

As we approach the quarter mark of the 21st century, the value of freedom may no longer be referenced solely by BTC, which is driven by compliance and deeply participated in by institutions, but is more likely to be redefined by those technological solutions that still focus on privacy and sovereignty. From this perspective, the return of ZEC resembles a “sovereignty signal” that reignites market discussion.