Ownership of Bitcoin in the Qian Zhimin Case and Victim Compensation

The Bitcoin controlled by UK law enforcement in the Qian Zhimin case has drawn the attention of victims seeking compensation. How the assets will be distributed and what additional evidence is needed for already registered losses are the most pressing concerns for the parties involved. A recent ruling by the High Court of England and Wales has established a starting point for the legal analysis of one key dispute.

On October 12, 2026, the High Court of England and Wales issued a preliminary ruling in the case of DPP v Zhimin Qian, case number [2026] EWHC 2509 (KB). The court decided that the fundamental rights supporting the victims' claims to property rights should be determined according to Chinese law; the specific content of Chinese law and the evidence for each request will be addressed in subsequent stages.

This ruling directs the next steps in compensation towards legal basis and evidence preparation. Victims need to clarify how they invested funds, what rights they obtained, and how these rights are connected to the controlled property. For the legal service teams, cross-border procedural management, financial record organization, and legal arguments under Chinese law need to be coordinated from the outset.

▌ 1. What Stage Has the Case Reached

The investment activities organized by Qian Zhimin in China and the subsequent flow of funds form the factual background of the UK case. The UK court has handled the choice of law issue based on agreed assumed facts: the investment activities were primarily conducted in China, relevant contracts, payments, and initial fund receipts also occurred in China, and part of the funds were later converted into Bitcoin and other assets.

These background materials are used to determine the applicable law. The ruling clearly states at the outset that evidence regarding the content of Chinese law had not yet been submitted, nor had the specific evidence of each applicant been thoroughly examined. Therefore, the subsequent work will delve deeper into individual investment relationships, the flow of funds, and the nature of rights under Chinese law.

The UK Crown Prosecution Service had already indicated in a victim notification issued in October 2024 that a civil recovery procedure had been initiated under the Proceeds of Crime Act 2002 (POCA), specifically Part 5. This procedure is initiated by law enforcement agencies concerning criminal proceeds or their representative property, aiming to identify and control recoverable assets.

In parallel, victims can assert their property rights claims in the corresponding procedures. The prosecution service indicated at the time that reasonable time would be allowed for relevant parties to obtain legal opinions and submit appropriate applications. As the court subsequently issues instructions, the specific participation methods, deadlines, and material requirements should be based on the currently valid court orders and formal notifications.

Criminal convictions, civil recovery, confirmation of victims' property rights, and final distribution address different issues. The criminal procedure deals with criminal liability; the asset procedure identifies and disposes of relevant property; the victims' applications require the court to determine what rights they have over specific property or shares. Understanding these steps is essential to know what type of materials should be prepared at this stage.

Based on [2026] EWHC 2509 (KB); this ruling does not determine final distribution.

▌ 2. What Does Section 281 Require to Prove

Section 281 of POCA is the main legal entry point for the victims' claims. This section allows individuals claiming that property or part of it intended for recovery belongs to them to apply to the court for a corresponding declaration. Once the court confirms that the conditions are met, the property covered by the declaration will be excluded from recoverable assets.

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According to subsection 3 of Section 281, the applicant must prove that they lost the claimed property due to unlawful acts or the original property represented by that property; the lost property itself does not belong to recoverable assets; and the property now claimed belongs to them. These three conditions need to be explained in conjunction with specific facts and legal bases.

The most concerning aspect is "belonging to oneself." Paragraphs 18 to 23 of the ruling explain that the applicant is required to prove property rights. A general request for a criminal to repay a sum of money differs legally from having rights over specific controlled property.

A simplified example can help understand this. If Person A is deceived by Person B and loses a sum of money, A can demand B return the loss. If A further claims that a certain asset or part of it held by B legally still belongs to A, they need to explain how this specific right was established and connect the facts with the applicable law. The relevant applications in the Qian Zhimin case face this level of argumentation.

This also determines the order in which lawyers organize materials. First, confirm the legal relationship between the investor and the payee, then analyze the rights arising after payment, and subsequently discuss whether and how those rights continue after the funds are converted into Bitcoin. Each step requires evidence and legal basis; merely listing the loss amount cannot complete the entire argumentation.

The reports, criminal case materials, and loss registrations that victims have already obtained can help prove the investment and damage facts. Claims involving specific property rights should further clarify which materials can support which elements and what facts need to be further clarified. Corresponding evidence with elements will make subsequent hearings easier to focus on.

The three elements should be understood in conjunction with Section 281(3) of POCA and the specific case facts.

▌ 3. Why the UK Court Applies Chinese Law

Cross-border cases often involve multiple sets of laws. The court first needs to determine whether the dispute pertains to contract, tort, restitution, or property rights, and then identify the corresponding law through choice of law rules. This process is commonly referred to as choice of law, aiming to find applicable norms for specific disputes.

In this case, the applicants proposed different legal paths, including claims to Bitcoin rights based on the original investment relationship, trust, or tracing rules. The court analyzed these paths separately and, considering factors such as the location of the transaction, the relationship between the parties and the contract, fraudulent activities, and the initial transfer of property, determined that the fundamental rights should be judged according to Chinese law.

Paragraphs 242 to 246 of the ruling focus on explaining the conclusion: the relevant contracts, non-contractual obligations, and the fundamental issues involved in the analysis of private international law point to Chinese law. The applicants' attempt to directly rely on the statutory tracing arrangements of POCA to establish their property rights was not accepted by the court; the recovery system of POCA itself continues to apply. The specific content, effects, and proof of Chinese law will be addressed in subsequent stages.

Therefore, the case continues to progress within the UK procedures, and the UK court needs to ascertain and apply the relevant Chinese law. The victims' legal teams need to clearly explain the rights structure under Chinese law to the court and provide legal materials or expert evidence that meet procedural requirements.

This work will involve how specific contracts are characterized, how unlawful activities affect civil relationships, how restitution and property rights claims are distinguished, and how mixed and converted properties are handled. Expert opinions should revolve around these issues and explain how the provisions, judicial interpretations, and related adjudication materials support the conclusions.

Translating Chinese legal provisions word for word is only part of the task. The UK court also needs to understand the role of the provisions within the actual legal system, the conditions for application, and the results of remedies. For instance, whether a restitution request points to the original property, substitute property, or equivalent compensation will affect its connection with the requirements of Section 281.

Such arguments also need to directly address different interpretations. If there are multiple viewpoints on the same issue, the legal team should explain their respective bases and their relationship with the facts of this case, leaving the real disputes that affect the outcome for the court's judgment. Legal opinions prepared in this way can support subsequent inquiries and evidence reviews.

▌ 4. How to Trace After Funds Are Converted to Bitcoin

The assets in this case have undergone stages of receiving fiat currency, transferring between different accounts, purchasing or acquiring Bitcoin, subsequent holding, and cross-border control. The longer the path of funds, the more victims need to distinguish between confirmed facts and connections that need investigation.

On-chain transaction records can help illustrate the movement of assets between addresses. Exchange accounts, bank statements, device information, and records of related individuals can help clarify who controls the addresses and where the funds for purchasing coins came from. Combining these two types of data can connect on-chain movements back to specific individuals and businesses.

Legal tracing also needs to answer another set of questions. How to identify rights after original funds are mixed with other funds; whether substitute property can be claimed after asset conversion; and how to calculate corresponding shares when assets are partially consumed or partially appreciated. These conclusions need to be supported by applicable law.

Sections 304 to 310 of POCA set out the rules for law enforcement agencies to identify recoverable property, dealing with the conversion, mixing, and related property of criminal proceeds. For victims, the application under Section 281 also needs to complete another proof: what rights they have over which properties according to applicable law. Lawyers thus need to match the results of on-chain tracing with the basis of rights, explaining the origins of the claimed shares item by item.

For the parties involved, the most helpful approach is to divide the tracing materials into factual records and legal analysis. Factual records should itemize payments, receipts, conversions, and known asset directions; legal analysis should then explain the impact of each node on rights. This can reduce the situation where investigative hypotheses are directly treated as established conclusions.

The appreciation of Bitcoin will also enter this analysis. If a property right and its share are confirmed, how subsequent asset changes are handled needs to be combined with the nature of that right and the court's decision. If the path taken is restitution for losses or other remedies, the corresponding rules for calculation must also be followed. The legal basis for individual requests should be established first, followed by discussions on amounts and appreciation, making the argument clearer.

On-chain records need to correspond with banks, contracts, and legal bases.

▌ 5. How Should Victims Organize Their Materials

A material package suitable for cross-border hearings should allow someone unfamiliar with the case to understand the basic process. A personal fact timeline can be created first, recording project contacts, signed materials, payments, receipts, problem discoveries, reports, and prior registrations by date, with corresponding evidence noted after each item.

Identity and application qualifications are the first group of materials. The applicant's name, former names, identification, contact information, and authorization for representatives should correspond with each other. If inheritance, guardianship, joint funding, or payments on behalf of others are involved, it is necessary to further explain the rights holders and the actual sources of funds.

Contracts and promotional materials are the second group. Investment agreements, subscription certificates, project descriptions, chat records, and written commitments received at the time can help reconstruct the transaction content. Retaining original documents, obtaining timestamps, and understanding the context can reduce misunderstandings caused by isolated screenshots.

Financial materials are the third group and require the most meticulous verification. List the date, amount, payment account, payee, and transaction number for each payment together, and separately list any refunds, earnings, or other amounts already received. Total investment, amounts recovered, and claimed losses should be calculated separately, and the calculation process should be preserved.

For those already registered or refunded in Chinese procedures, case numbers, acceptance records, confirmation documents, and proof of receipt should also be retained. Domestic and foreign lawyers need to know whether the same loss has already been partially processed to avoid conflicting amounts or duplicate claims in different materials.

When materials are used for UK procedures, translation, certification, and formal requirements should be confirmed by professionals handling the procedure according to specific instructions. It is advisable to first standardize name translations, date formats, currencies, and document numbers, and then create a material directory. The original and translated documents should correspond item by item, and subsequent supplementary evidence will save time.

If some bank records are difficult to obtain, the reasons for the missing records should be explained first, and payment notifications, receipts, correspondence, police report attachments, or other materials that can mutually corroborate should be sought. The factual narrative needs to truthfully retain gaps, and lawyers will reassess whether there are formal retrieval channels and alternative proof methods.

The translation and submission format should be determined according to specific procedural requirements.

▌ VI. How to Coordinate Chinese and British Procedures

Articles 298 to 300 of China's Criminal Procedure Law stipulate specific procedures for the confiscation of illegal gains in cases of specific absconding or death. Article 299 involves announcements after the court's acceptance and the participation of interested parties, while Article 300 concerns the handling of illegal gains and other related properties, stipulating that property should be returned to the victims as required by law.

The aforementioned confiscation procedures have specific cases and applicable conditions, and the legal team should first verify the procedures actually adopted domestically and existing judgments. When it involves assets already controlled abroad, it is also necessary to combine foreign procedures, judicial assistance, and specific execution arrangements, recording formal notifications from both sides, submission deadlines, and submitted materials separately. Only then can it be determined to which authority the next application should be submitted.

The notice from the UK Crown Prosecution Service in 2024 also indicates that inter-state contacts regarding the return of assets need to be combined with civil recovery and the progress of applications under Article 281. This notice can help understand the procedural design at that time, while the specific progress still needs to be updated according to subsequent effective decisions.

For victims, the most confusing statuses are "already registered," "already become an applicant in a certain procedure," "property rights confirmed," and "already entered into payment arrangements." The legal team can use a concise progress chart to clarify which step is currently being taken, what the next document will resolve, and inform the parties of the specific matters they need to cooperate with.

When multiple victims jointly hire lawyers, the scope of representation, cost-sharing, information sharing, and confirmation methods for major decisions should also be clarified. Common facts can be organized centrally, while individual payment and refund records need to be verified separately. The contract, receipt, and evidence situations of different individuals may affect specific claims, and these differences should be preserved during the process.

For parties who already have domestic proxy lawyers, they can authorize them to coordinate with foreign lawyers regarding necessary materials and clearly define the scope and method of data transmission. Identification, bank statements, and contact information all involve personal information and should be exchanged through reliable channels to avoid repeatedly uploading complete materials in public group chats.

▌ VII. What Work Should Legal Services Focus On

The preliminary work for such cases can be broken down into fact organization, path assessment, and procedural execution. Fact organization answers what the parties have invested, how much has been recovered, and what evidence is available; path assessment determines what requests the existing materials support; procedural execution involves submitting documents, supplementing evidence, and participating in subsequent hearings as required by the court.

Chinese legal analysis should have a clear list of issues, such as the basic contractual relationship, the nature of the return request, rights after property conversion, and the relationship with the disposal of the involved property. Foreign procedure lawyers should then organize these contents based on the requirements of Article 281 and court instructions, deciding which issues require expert evidence and which can be proven through factual documents.

The power of attorney should also clearly outline the scope of work. Preliminary assessments, material translations, formal applications, expert opinions, court appearances, and possible appeals may incur separate costs. Clearly defining deliverables and budgets by stage helps parties assess whether to continue investing, avoiding commitments to an entire set of unclear fees without understanding the procedures.

In asset recovery, it is also necessary to guard against impersonation of courts, prosecution agencies, or agents regarding fee information. Verify official agency websites, lawyer practice materials, and payment entities, and retain authorization documents and payment records. Any claims of already determined distribution ratios, requests for "unfreezing fees," or demands for wallet keys should first be verified with the actual handling personnel.

The next time parties communicate with their proxy lawyers, they can ask for clarification on three specific matters: whether they have already participated in the relevant procedures, what rights proof is still missing from the existing materials, and when and to whom the next document should be submitted. Keeping replies, the scope of authorization, court notifications, and funding proofs in the same case record provides a basis for verifying subsequent supplementary documents and fee arrangements.

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