In a high-stakes legal battle unfolding in the UK’s High Court of Justice, a woman stands accused of covertly stealing over $172 million worth of Bitcoin from her estranged husband’s hardware wallet. The case, which involves allegations of surveillance and a complex web of digital transactions, highlights the vulnerabilities in cryptocurrency security and the challenges of digital asset recovery.
According to court documents, Ping Fai Yuen, a UK resident, held 2,323 Bitcoin in a Trezor hardware wallet in 2023. On August 2, 2023, the entire balance was transferred without his knowledge, and the funds were subsequently split across 71 separate addresses. The transactions have remained dormant since December 21, 2023, raising questions about the fate of the stolen funds.
Yuen claims that his wife, Fun Yung Li, and her sister, Lai Yung Li, obtained access to the wallet’s recovery phrase, a critical piece of information required to recreate the wallet and move the funds. The filings allege that Li used covert surveillance to capture the recovery phrase, possibly with the help of her sister. Yuen’s daughter had warned him in July 2023 that Li was attempting to access his Bitcoin, prompting Yuen to install audio recording equipment in their home.
The recordings, which are cited as key evidence, include a conversation where Li allegedly stated, “The Bitcoin has transferred to me” and “take all of it.” Another recording from July 29, 2023, suggests that Li discussed camera placement and the location of Yuen’s wallet credentials, indicating a premeditated plan to access the funds.
After discovering the theft, Yuen confronted Li, leading to an altercation where he was arrested and later pleaded guilty to assault. Li was also arrested in 2023, but the police released her after a no-comment interview, stating they would take no further action without new evidence.
In November 2025, Yuen sought a proprietary asset preservation injunction, asking the court to confirm his ownership of the Bitcoin, freeze Li’s crypto holdings, and order the return of the assets or an equivalent sum in British pounds. Justice Cotter, in a judgment following a March 2 hearing, noted that Yuen’s case shows a strong likelihood of success, citing the warning from his daughter, the audio transcripts, and the discovery of equipment capable of accessing the wallet.
“The evidence is that he was warned of what the First Defendant was seeking to do, the transcripts are damning,” Cotter wrote. The judge also applied Occam’s razor, the principle that the simplest explanation with the fewest assumptions is often the most likely, to support Yuen’s account. Cotter emphasized the need for a swift trial due to the volatility of Bitcoin, which could significantly impact the value of the disputed assets during litigation.
This case is expected to test the legal framework for handling ownership and recovery claims tied to digital assets in English courts. It underscores the importance of robust security measures and the potential legal complexities surrounding cryptocurrency theft and recovery.
The outcome of this case could set a precedent for future disputes involving digital assets and highlight the need for clearer regulations and legal protections in the rapidly evolving world of cryptocurrency.
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