Thursday, July 2

4,000 Chinese Bank Accounts Reportedly Frozen Due to Crypto Connections

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Around 4,000 Chinese bank accounts of cryptocurrency traders have reportedly been frozen by local law enforcement.

According to a June 8 report by 8BTC, police froze the bank accounts of thousands of  over-the-counter (OTC) traders from the Chinese province of Guangdong.

This purportedly comes as part of a wider investigation into illegal activities such as gambling and money laundering, which 8BTC states have been commonly facilitated by crypto OTC trading with the stablecoin Tether (USDT). 

Per the report, authorities started freezing the bank accounts on June 4. One retail investor reportedly found his bank account frozen after buying cryptocurrency on a major, credible crypto exchange.

Frozen accounts are not guaranteed to be involved in illicit activities and can supposedly be restored after an analysis of their activities reveals no wrongdoing. 

Local law enforcement is purportedly learning blockchain analysis skills in order to track on-chain crypto asset transactions.

Crypto’s involvement in money laundering

Cryptocurrency transactions cannot be stopped by authorities, and crypto wallets do not need to be linked to personal identities like bank accounts are. Because of these features, crypto is occasionally used by tech-savvy criminals for money laundering purposes.

As Cointelegraph reported in late February, threat intelligence firm IntSights claimed that cryptocurrencies are increasingly being used for money laundering in Latin America. 

In May, an Australian woman was arrested after selling Bitcoin (BTC) for cash. She is accused of having run a money laundering operation since 2017.

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