Beijing, China — A cryptocurrency wallet linked to a little-known Chinese mining pool has reportedly fallen victim to one of the largest Bitcoin thefts in history, with losses estimated at $3.5 billion. This revelation comes from Arkham Intelligence, an analytics firm specializing in blockchain investigations.

According to findings shared on August 2, Arkham disclosed that 127,426 Bitcoin were stolen from the LuBian Mining Pool in late December 2020. Neither LuBian nor the purported hacker have publicly commented on the breach, making this incident one of the most significant undisclosed thefts to date. Arkham’s announcement is considered the first of its kind, shedding light on an event that had gone unnoticed in the crypto community.

During its peak, LuBian was one of the largest Bitcoin mining pools globally, controlling nearly 6% of the total Bitcoin hash rate by May 2020. If confirmed, this hack would surpass the combined values lost in other notorious incidents, such as the Mt. Gox and Bitfinex breaches, making it a critical point of concern for the crypto sector.

Arkham’s investigation noted that on December 28, 2020, a staggering 90% of LuBian’s Bitcoin holdings were drained. Just two days later, an additional theft involving around $6 million worth of Bitcoin and USDT was also identified, occurring through an address associated with LuBian on the Bitcoin Omni layer. By year-end 2020, LuBian had transferred its remaining 11,886 Bitcoin, amounting to hundreds of millions at that time, into wallets designated for recovery.

A unique aspect of Arkham’s findings includes the identification of OP_RETURN messages—transactions enabling data embedding on the Bitcoin blockchain—sent from LuBian to the thief. Arkham suggests that the mining pool attempted to communicate with the hacker, spending 1.4 Bitcoin over more than 1,500 transactions in efforts to retrieve the stolen assets. This implies that the messages might have been sent by the actual owner of the wallet, rather than fabricated.

The analytics firm speculates that a potential weakness in LuBian’s private key generation algorithm could have left the pool vulnerable to brute-force attacks. Furthermore, the stolen Bitcoin appears to be mostly inactive, with the last significant movement recorded in a wallet consolidation in July 2024.

Given the recent price surge in Bitcoin, the current value of the stolen assets has ballooned to approximately $14.5 billion. This fortune positions the wallet associated with the suspected hacker as the 13th largest Bitcoin holder tracked by Arkham, exceeding the stolen amount from the Mt. Gox incident.

As of now, both the hacker and LuBian are believed to retain control over their respective Bitcoin balances. Arkham has made wallet trackers available for both entities, yet further information revealing the identities of those involved has not been disclosed, leaving many questions unanswered in this ongoing saga of cryptocurrency theft.