Part of the CustodyStress archive of observed Bitcoin custody incidents
CS-00958
The 3,200 BTC gap had been spent on personal expenses over four years.
BlockedCase description
A Bitcoin fund that had claimed to hold 4,000 BTC on behalf of investors was found in February 2021 to have actual holdings of only 800 BTC. The fund manager had been manufacturing performance reports using Excel. Investors had never requested or received proof-of-reserves. The 3,200 BTC gap had been spent on personal expenses over four years.
Custody context
| Stress condition | Documentation absent |
| Custody system | Exchange custody |
| Outcome | Blocked |
| Documentation | Unknown |
| Year observed | 2021 |
| Country | Unknown |
Structural dependencies observed
What this illustrates
Nobody had written down how to get back in. That knowledge existed only in the owner's head. Access was not recoverable.
Outcome interpretation
Access was not possible under the reported conditions.
Source
Publicly Reported
Evidence type
Forum post
Evidence link
Related cases involving documentation absent
This archive documents observed custody survivability failures. It does not attempt to document all Bitcoin losses or security incidents.
Submit a case
← All cases
Framework references
Where Bitcoin Custody Intersects Legal and Fiduciary Authority
Where custody creates gaps in estate planning, fiduciary duty, and professional responsibility.
Professional Scope Boundary Matrix
What each professional or product covers, what they do not, and where gaps form between them.
The Independent Assessment Layer in Bitcoin Custody
How independent diagnostic layers emerge when multiple parties depend on shared infrastructure.
Translate