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Criminals in China Facing Increased Repercussions for Illicit Crypto Activities
China’s highest prosecutor recently addressed the surge in cybercrime occurring within blockchains and the metaverse, highlighting increased repercussions for criminals engaging in illicit operations using blockchain technology and metaverse projects.
Increased Focus on Crypto Crime
During a press conference held by the China’s Supreme People’s Procuratorate on February 23, spokesperson Li Xuehui emphasized the rapid evolution of crypto money laundering into a mainstream conduit for illicit wealth and criminal activities, signaling an increased focus on combatting crypto-related crimes.
Public Warning and Vigilance
Zhang Xiaojin, the Director of the Fourth Procuratorate of the Supreme People’s Procuratorate, warned the public about the prevalence of “high yield, low risk” investment scams within China’s local crypto economy. The Chinese prosecutor urged individuals to stay vigilant and adapt to evolving criminal strategies, citing the example of pig butchering as one of the most prominent scams.
The practice of pig butchering involves establishing a connection with a victim, persuading them to invest in a deceptive digital asset project or exchange, and subsequently vanishing with their invested capital. This type of scam has also been encountered by U.S. authorities, as they successfully seized over $9 million in Tether’s USDT stablecoin last year in connection with a pig butchering scam.
Enforcement and Regulatory Landscape
Last year, Chinese authorities prosecuted over 42,000 individuals implicated in electronic fraud and crypto scams. Despite the prohibition of crypto trading and mining in China since 2021, the country has made advancements in CBDCs and regulatory policies surrounding Web3 technologies.
China’s recent crackdown on individuals running blockchain and metaverse scams aligns with a surge in illicit crypto activities in Hong Kong. Crypto-related crimes in the special administrative region have nearly tripled since 2021, according to Hong Kong’s Financial Services and Treasury. Hong Kong has recently implemented crypto-friendly regulations aimed at standardizing its local digital asset ecosystem and safeguarding investors.
As the transitional period for the #VirtualAsset Service Providers licensing system enters its final stage, the Hong Kong SAR Government is gradually enhancing measures on virtual asset regulation to facilitate market development.
Ian is a cryptocurrency enthusiast blending humor with professionalism. With an engineering background and a storyteller's heart, he simplifies the blockchain world with sharp analysis and a touch of wit. At Cryptowire, he brings his unique perspective to make digital financial innovation accessible to all.
