Between April 2019 and June 2021, Chinese cryptocurrency wallets reportedly sent more than $2 billion in digital assets to addresses associated with illicit activities.
Chainalysis, a blockchain data provider, revealed that Chinese cryptocurrency accounts sent over $2.2 billion in digital assets to addresses associated with criminal activity such as fraud and darknet transactions over a two-year period. Large-scale Ponzi schemes, on the other hand, are less popular in China than in other countries.
Between April 2019 and June 2021, Chinese crypto wallets transferred more than $2.2 billion in virtual assets to accounts associated with money laundering, drug trafficking, and other illegal activities, according to a study conducted by the blockchain data platform Chainalysis. Additionally, these addresses received an additional $2 billion in cryptocurrency from criminal sources.
While the numbers appear high, they have decreased significantly over the last two years when compared to other countries. Chainalysis explained that the primary reason for this is that large-scale Ponzi schemes are becoming less prevalent in the world’s most populous nation.
However, it noted that China is the global fentanyl trade’s epicenter, noting that many drug producers conduct transactions using digital assets. Chinese criminals engaged in money laundering activities also make use of virtual currencies and cryptocurrency exchanges. Additionally, some of them have built their illegal businesses on top of these trading platforms.
According to Chainalysis, the Asian nation takes action against such bad actors and cited Zhao Dong as an example. Zhao Dong is the founder of several Chinese over-the-counter (OTC) businesses. He pleaded guilty in May to money laundering charges after authorities arrested him earlier this year for assisting in illegal internet activity.
Members of a Chinese Crypto Scam Face 11 Years in Prison
While cryptocurrency fraud and the use of digital assets in scams are common in China, the country’s authorities prosecute those involved in such criminal activities severely. As CryptoPotato reported in late 2020, the principal actors in the PlusToken Ponzi scheme will serve an 11-year prison sentence. The scam was successful in defrauding investors of $2.25 billion in virtual currency.
The operation was hailed as a major victory by officials due to the fact that it was one of the largest Ponzi schemes to ever occur in China. Along with the imprisonment, the authorities fined two of PlusToken’s key members $18,000 and $913,000.
Also Read Jack Dorsey Offers ‘Workable Simplification’ For Crypto Tax.
Wallets