This article first appeared on GuruFocus.

China has reignited tensions with Washington, accusing the U.S. government of masterminding a massive crypto heist that siphoned 127,272 Bitcoin (BTC-USD) worth roughly $13 billionfrom the LuBian mining pool back in December 2020. Beijing’s National Computer Virus Emergency Response Center said the theft bore the signature of a state-level hacker operation, pointing to the slow and discreet movement of the stolen assets as evidence of government coordination. The report linked the missing Bitcoin to tokens later confiscated by the U.S., which prosecutors said were tied to Chen Zhi, the chairman of Cambodia’s Prince Group, indicted in October on charges of wire fraud and money laundering. The Department of Justice has not disclosed how or when the Bitcoin was seized.

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For Washington, the case represents the largest forfeiture action ever filed involving digital assets. For Beijing, it’s a narrative of digital espionage hidden under the veil of law enforcement. Chen’s defense team, led by Matthew L. Schwartz of Boies Schiller Flexner, has pushed back, calling the allegations seriously misguided and requesting more time to trace the Bitcoin’s origins. Schwartz said they’re working with cryptocurrency forensics experts to track the same Bitcoin stolen from LuBian that was later seized by the U.S. government. Chen himself remains outside U.S. custody, and prosecutors have declined to clarify how they gained access to the coins.

This latest flashpoint lands in an already charged cyber rivalry. China has accused the U.S. several times this year of digital intrusions, from alleged Microsoft Exchange exploits to an attack on the National Time Service Center. The U.S., for its part, has stayed silent on Beijing’s new claims. For investors, the stakes stretch beyond geopoliticsthe widening cyber front between the world’s two largest economies could add another layer of volatility to digital assets, regulation risk, and global tech competition.