DOJ Seizes $52M in Crypto From Xinbi Scam Marketplace
The US Justice Department’s Scam Center Strike Force seized and restrained more than $52 million in crypto linked to Xinbi Guarantee, a Chinese-language marketplace operating mainly through Telegram. Prosecutors said Xinbi provided services to scam compounds, including investment-fraud websites, money laundering and recruitment of trafficking victims. The operation included two wallets worth about $12 million and 47 additional wallets tied to Xinbi and its vendors. The Treasury Department’s Office of Foreign Assets Control also designated Xinbi and two related entities as transnational criminal organizations. The seizure raises the Strike Force’s total restrained crypto to roughly $938 million since its creation in November 2025. Separately, Strike Force officials supported Madagascar’s crackdown on 13 Chinese-run scam compounds, processing more than 3,200 devices and interviewing about 400 detainees. The UK sanctioned Xinbi in March, while Chainalysis estimated that the platform processed nearly $20 billion in crypto between 2021 and 2025. US authorities reported $8.65 billion in crypto investment-fraud losses in 2025, up 89% from 2023, although the FBI said the figures understate the true scale of the problem.
Neutral
The market impact is likely neutral because the seizure targets wallets and services linked to a criminal marketplace rather than a major legitimate cryptocurrency, exchange or blockchain protocol. In the short term, the announcement could create mild negative sentiment around crypto by highlighting money laundering, investment fraud and regulatory risk. Traders may also watch for movement from related wallets, although the article does not identify a major token liquidation or a direct threat to market liquidity. Similar enforcement actions, including sanctions against crypto mixers and illicit marketplaces, have often caused temporary volatility in specific assets or privacy-focused sectors but have not produced sustained weakness across the broader market. In the long term, the operation may be modestly constructive for market stability. Removing scam infrastructure and tracing illicit funds can support institutional confidence, compliance efforts and clearer regulation. However, the sharp rise in reported crypto investment fraud may keep pressure on exchanges and service providers to strengthen know-your-customer, transaction-monitoring and anti-money-laundering controls. Traders should monitor wallet movements, further OFAC designations and possible exchange restrictions. Unless authorities link the case to a major token or seize funds from a systemic market participant, the event is unlikely to materially change prices for BTC, ETH or the wider crypto market.