A report cited by BlockBeats on July 13 said an article published via the Procuratorial Daily examined the criminal-law challenges tied to money laundering involving virtual currencies in China. The paper was jointly written by researchers from the Yuhu District People’s Procuratorate of Xiangtan, Hunan, and the Faculty of Law at Xiangtan University.
According to the report, the authors grouped the current problems in judicial practice into three areas: how such conduct is classified under criminal law, how evidence is obtained, and how illicit assets are recovered. The article said Article 191 of the criminal law still limits the offense of money laundering to seven categories of predicate crimes, leaving many cases to be handled instead as the crime of concealing or disguising criminal proceeds. It also said mixers, privacy coins, and cross-chain transfers can fragment the evidence trail, making traditional investigative methods less effective. In asset recovery, the paper pointed to conflicts over the legal nature of virtual currencies, gaps in procedural rules, and barriers to cross-border cooperation.
The authors proposed judicial, evidentiary, and coordination measures, including more proactive legal review, tailored standards for authenticating electronic evidence, and a national cross-department mechanism for disposal and recovery.
Article lists three legal bottlenecks
BlockBeats reported on July 13, citing Procuratorial Daily, that researchers from the Yuhu District People’s Procuratorate of Xiangtan in Hunan and the Faculty of Law at Xiangtan University jointly published an article on criminal-law responses to money laundering involving virtual currencies.
The article said judicial practice now faces three main problems. First is offense classification. Article 191 of China’s criminal law still limits money laundering to seven categories of predicate crimes, which means many cases can only be treated as the crime of concealing or disguising criminal proceeds.
Second is evidence collection. The use of mixers, privacy coins, and cross-chain transfers can leave a fragmented evidence trail, making traditional investigative tools hard to apply effectively. Third is asset recovery. The article said conflicts over the legal nature of virtual currencies, gaps in procedural rules, and barriers in cross-border cooperation have made recovery and enforcement harder.
Proposed responses
On classification, the authors proposed shifting judicial practice from passive identification to proactive review, while also strengthening the guiding role of procuratorial supervision and assessment standards.
On proof and verification, they called for standards suited to authenticating and reviewing electronic evidence, a tiered standard of proof with reasonable presumptions, and exploration of authorized and regulated use of technical investigative measures.
On recovery of losses, the article proposed a national cross-department coordination mechanism and called for active participation in, and leadership of, international rules and cooperation platforms.
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