A court in China has sentenced a man to 10 years and six months in prison after he was found guilty of stealing 107 Bitcoin by memorizing a cryptocurrency wallet’s seed phrase and later using it to transfer the funds without authorization.
According to local reports, the case involved a victim who had shared access to a wallet recovery phrase in a trusted setting. The defendant allegedly memorized the seed phrase, which serves as the master key to a crypto wallet, and later used it to gain access to the funds.
Investigators said the man transferred 107 Bitcoin from the victim’s wallet into addresses under his control without permission. At current market prices, the stolen cryptocurrency would be worth millions of dollars.
The court ruled that the unauthorized access and transfer of digital assets constituted theft and handed down a prison sentence of 10.5 years, along with additional financial penalties.
The case highlights one of the most important principles in cryptocurrency security: possession of a wallet’s seed phrase effectively grants complete control over the assets stored in that wallet.
A seed phrase, typically consisting of 12 or 24 randomly generated words, is used to recover access to a cryptocurrency wallet if a device is lost or damaged. Anyone with access to that phrase can generally restore the wallet and move the funds, making it one of the most sensitive pieces of information in digital asset ownership.
Unlike traditional bank accounts, cryptocurrency transactions cannot typically be reversed once funds are transferred. As a result, users are advised never to share seed phrases with anyone and to store them securely offline.
The ruling also reflects how courts around the world are increasingly treating digital asset theft in the same manner as traditional financial crimes. As cryptocurrency adoption grows, legal systems are continuing to develop frameworks for handling cases involving unauthorized access, fraud, and theft involving blockchain-based assets.
The incident serves as a reminder that while blockchain networks themselves may be secure, human error and poor security practices remain among the biggest risks facing cryptocurrency users.
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