China Targets Crypto Money Laundering with New Law Revision

tamir
Sun, 15 Sep 2024 07:03:38 +0000
China, Crypto Compliance, Money Laundering

The adoption of crypto is evident, not least from the use of cryptocurrencies for illegal activities and money laundering. This is increasingly becoming a problem for the authorities. China's new law revision aims to tackle cryptocurrency-enabled money laundering by introducing stricter provisions and predicate offenses, aligning with global AML standards.

The adoption of crypto is evident, not least from the use of cryptocurrencies for illegal activities and money laundering, which is increasingly becoming a problem for the authorities. China’s new Anti-Money Laundering law revision aims to tackle cryptocurrency-enabled money laundering by introducing stricter provisions and predicate offenses, aligning with global AML standards.

Key Points:

China is revising its money laundering laws to address crypto-related crimes.

The new legislation will introduce seven predicate offenses linked to complex criminal and organized activity.

This aligns Chinese regulations with international standards and aims to enhance surveillance of tech-based financial crimes. China does not recognise virtual currencies as legal tender and strictly prohibits their circulation in the market.

Short Narrative:

China is revising its money laundering law to take a firm stance against cryptocurrency-based money laundering. The Standing Committee of the National People (SCMP)’s Congress will introduce provisions that specifically target illicit crypto transactions. These changes, which include seven newly defined predicate offenses, aim to address the growing risks associated with tech-based money laundering.

China’s highest court, the Supreme People’s Court, along with the Supreme People’s Procuratorate, has issued new judicial interpretations that explicitly include the use of virtual assets to transfer criminal proceeds as a form of money laundering and consider cryptocurrencies, online game coins, and live streaming tips as potential channels for money laundering.

The legislative updates come in response to the increasing complexity of detecting financial crimes in the digital age. China, which already prohibits using cryptocurrency as legal tender, is stepping up its efforts to align with global anti-money laundering standards and crack down on crypto-enabled crime.

Actionable Insight:

China’s crypto exchanges and financial institutions should prepare for stricter regulatory oversight and enhanced monitoring requirements. Businesses involved in cross-border transactions should ensure compliance with the evolving legal framework as the crackdown on crypto-based money laundering continues.

Call for Information:

If you have any information about crypto-based money laundering activities or other suspicious crypto transactions, please report it to us via our whistleblower system, Whistle42.