The Chinese government, through the Panshi City Public Security Bureau in Jilin Province, has cracked down on illicit cryptocurrency banking activities, as reported by local media.
The perpetrators allegedly exploited the anonymity of cryptocurrencies for illegal foreign exchange transactions.
According to reports, six individuals involved in purchasing foreign exchange using cryptocurrencies have been arrested by Chinese security officials. The investigation revealed that these criminals had transferred funds totaling approximately 2.14 billion renminbi (RMB), equivalent to around $295.79 million.
The police discovered that the criminal group engaged in illegal foreign exchange activities using domestic accounts for fund transfers, over-the-counter (OTC) virtual currency trading, settlement in Korean won, and other methods. They facilitated exchanges between RMB and Korean won for Korean purchasing agents, cross-border e-commerce, import and export trading companies, and similar groups. However, the specific OTC platform involved was not disclosed by the police.
This raid aligns with recent actions taken by authorities in Hong Kong, a special administrative region of China. Since the beginning of the year, the Hong Kong Monetary Authority (HKMA) has been targeting illegal OTC services, suspecting that Chinese nationals use these platforms to circumvent overseas transfer limits.
Despite being part of China, Hong Kong operates under the "one country, two systems" principle, allowing it to maintain its own cryptocurrency regulations. While mainland China has strictly banned all cryptocurrency activities issued by private parties since 2021, Hong Kong still permits them.
According to Chainalysis, the volume of transactions in Hong Kong between July 2022 and June 2023 reached approximately $64 billion, with the OTC market being a significant contributor to this figure.
May 2024, Cryptoniteuae