Crypto Money Laundering Case in China Ends

Crypto Money Laundering Case in China Ends

October 19, 2022

A billion-dollar crypto money laundering case in China has come to an end. Authorities say they busted an illicit group of money launderers who used a total of 40 billion yuan (roughly $5.6 billion in USD) to purchase digital currency funds.

China Is the Center of a Major Crypto Money Laundering Case

Arrests of over 90 individuals alleged to have been involved in the case recently occurred in the county of Hengyang, which is centered in China’s southern province of Huna. Roughly ten physical sites were raided by police and other law enforcement agents, who ultimately seized as many as 100 electronic devices and froze about 300 million yuan that is thought to have been garnered for illicit purposes. The campaign surrounding the arrests has been dubbed “Hundred-Day Action.”

Police say that those involved used the funds in question to purchase crypto. They then traded the crypto in for USD as a means of hiding their activity and laundering the money, all of which is thought to have come from either gambling or telecom scams according to legal documents surrounding the case.

There’s some irony to the situation in that there was a time when China was known as the number one digital currency haven across the globe. The country accounted for anywhere between 60 and 70 percent of the world’s mining operations, though the nation ultimately took flak from people like Kevin O’Leary of “Shark Tank” fame, who stated close to two years ago that he would not be buying any more BTC or crypto mined in China given the region did not invoke green extraction methods.

Much of China’s crypto mining operated through coal mining or other fossil fuel-based energy sources, and as a means of cleaning things up, the nation’s capital of Beijing issued new rules in the summer of 2021 stating that crypto mining would no longer be allowed within China’s borders. From there, all who were engaged in the practice of extracting units of crypto from the blockchain would either need to close their shops and find other industries to make livings in or pack up their bags and leave town.

A History of Fighting the Industry

It appears that many of these miners went to places like Texas or Florida, where energy prices are considerably less and where they could openly run their businesses without running the risk of being kicked out or forcibly removed. Others, however, refused to listen to the order and continued their operations via underground means to keep quiet and remain anonymous. Despite its previous order, China still ranks high as one of the top crypto mining regions in the world.

Things didn’t quite stop with bitcoin mining. China later issued an order that sought to ban all general crypto activity. This meant no more trading, no more buying, nothing.

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