Recently, there have been more and more reports involving money laundering using virtual currency. Some are articles directly issued by the judicial organs' self-media accounts, and some are media reports. Lawyer Liu predicts that in 2025, my country's judicial organs will increasingly crack down on money laundering crimes using virtual currency.
01The current situation of virtual currency money laundering crimes
In recent years, with the rapid development of blockchain technology, virtual currency has gradually become an important "non-mainstream off-site force" in the global financial system. However, the anonymity and decentralization of virtual currency also make it an important tool for money laundering. Whether domestically or internationally, cases of money laundering using virtual currency have occurred frequently, which has attracted great attention from judicial authorities in various countries.
In China, cases of virtual currency money laundering are common. For example, the "Yao Qian's use of virtual currency for power-for-money transactions" disclosed by the Central Commission for Discipline Inspection is a typical case. As a senior executive of a financial institution, Yao Qian used virtual currency for power-for-money transactions, involving a huge amount of money, which seriously undermined the financial order. This case not only exposed the concealment of virtual currency in corrupt transactions, but also revealed the complexity and harmfulness of virtual currency money laundering crimes. In addition, the "Virtual currency underground bank with a turnover of more than 17 billion yuan challenges supervision and law enforcement" case exposed on the Internet is even more shocking. In this case, the suspect transferred funds across borders through virtual currency underground banks, involving an amount of up to 17 billion yuan, which seriously endangered my country's financial supervision and law enforcement capabilities.
Internationally, virtual currency money laundering crimes are also rampant. According to Interpol reports, virtual currency has become one of the main tools for transnational criminal groups to launder money. For example, the famous "Silk Road" dark web platform is a typical case of using Bitcoin for drug transactions and money laundering (the platform owner has been pardoned by Trump). When the platform was seized, the amount involved was as high as billions of dollars. In addition, in recent years, with the rise of decentralized finance (DeFi), the means of virtual currency money laundering have become more diverse, and suspects can evade supervision through technical means such as smart contracts and cross-chain transactions, further increasing the difficulty of law enforcement.
02 Provisions of my country's Criminal Law on Money Laundering
Faced with the severe situation of virtual currency money laundering crimes, the provisions of China's criminal law on money laundering crimes are also being continuously improved. According to Article 191 of China's Criminal Law, money laundering crimes refer to the act of knowing that the proceeds and the proceeds generated by drug crimes, organized crimes of a mafia nature, terrorist activities, smuggling crimes, corruption and bribery crimes, crimes that undermine the financial management order, and financial fraud crimes , in order to conceal and conceal their sources and nature, providing capital accounts, assisting in converting property into cash, financial bills, securities, or assisting in the transfer of funds through transfers, remittances, etc.
In recent years, with the increase in virtual currency money laundering crimes, my country's judicial organs have continuously stepped up their efforts to crack down on money laundering crimes. On September 15, 2021, the People's Bank of China and ten other departments jointly issued the "Notice on Further Preventing and Dealing with Virtual Currency Trading Speculation Risks" (known as the "9.24 Notice" in the private sector), which clearly defined virtual currency-related business activities as illegal financial activities and required financial institutions and non-bank payment institutions not to provide services for virtual currency transactions. In addition, the Supreme People's Court and the Supreme People's Procuratorate have also successively issued relevant judicial interpretations, further clarifying the identification standards and sentencing rules for virtual currency money laundering crimes.
Specifically, according to the "Interpretation of the Supreme People's Court and the Supreme People's Procuratorate on Several Issues Concerning the Specific Application of Laws in Handling Criminal Cases of Money Laundering", the use of virtual currency for money laundering can be deemed as "assisting the transfer of funds through transfers, remittances, etc.", and may constitute the crime of money laundering.
03Using virtual currency to launder money is not absolutely "safe"
Although virtual currency has characteristics such as anonymity and decentralization, it does not mean that using virtual currency to launder money is absolutely safe. In fact, with the continuous advancement of blockchain analysis technology, in some cases, judicial authorities have been able to identify the identity of suspects and the flow of funds by tracking virtual currency transaction records.
First, although the blockchain is open and transparent, every transaction will be recorded on the blockchain and cannot be tampered with. This means that once the virtual currency address of the suspected criminal is identified, all of his transaction records can be traced. In recent years, many virtual currency money laundering cases at home and abroad have been successfully solved through blockchain analysis technology. For example, the US Federal Bureau of Investigation (FBI) successfully solved a virtual currency money laundering case involving hundreds of millions of dollars by tracking Bitcoin transaction records.
Second, the supervision of virtual currency exchanges is also being strengthened. At present, major virtual currency exchanges around the world have implemented "know your customer" (KYC) and "anti-money laundering" (AML) policies (some have also implemented "anti-terrorist financing" policies), requiring users to provide real identity information when registering. This means that it is difficult for criminal suspects to completely hide their identities when using virtual currencies to launder money. Once an exchange discovers a suspicious transaction, it will immediately report it to law enforcement agencies, increasing the risk of suspects being caught. (Of course, decentralized exchanges, mixers and other tools pose a great obstacle to the detection of crimes, but the technology of judicial organs is also constantly improving)
Third, with the strengthening of international cooperation, the cross-border crackdown on virtual currency money laundering crimes has also been increasing. In recent years, international organizations such as Interpol and the Financial Action Task Force (FATF) have carried out joint operations to combat virtual currency money laundering crimes. For example, in 2020, Interpol cooperated with law enforcement agencies in several countries to successfully crack a virtual currency money laundering case involving billions of dollars.
In addition, Lawyer Liu also expressed the same view in " A leader of the Beijing Financial Bureau was investigated for suspected Bitcoin money laundering. Using virtual currency to commit crimes is not 100% "safe" ": that is, according to current judicial practices in mainland China, criminal cases involving virtual currency are not "unbreakable."
04Written at the end
To sum up, with the increase in virtual currency money laundering crimes, 2025 will be an important year for Chinese judicial authorities to crack down on virtual currency money laundering crimes.
First, with the continuous advancement of blockchain analysis technology, judicial authorities will be able to track virtual currency transaction records more efficiently and identify the identities of suspects and the flow of funds;
Secondly, as the domestic criminal law continues to improve its provisions on money laundering, the identification standards and sentencing rules for virtual currency money laundering crimes will become clearer, and suspects will face more severe legal sanctions;
Finally, with the strengthening of international cooperation, the transnational crackdown on virtual currency money laundering crimes will continue to increase, and the possibility of using virtual currency to launder money without being detected will become increasingly smaller.
In short, although virtual currency has the characteristics of anonymity and decentralization, using virtual currency to launder money is not absolutely safe. With the advancement of technology and the improvement of laws, Lawyer Liu predicts that this year will be an important year for Chinese judicial authorities to crack down on virtual currency money laundering crimes, and the use of virtual currency for money laundering will face more severe legal risks.
