China’s official prosecutorial press has published a policy paper that proposes a stricter approach to cryptocurrency-related money laundering cases, including treating the use of crypto mixers and privacy coins as evidence of laundering intent.
According to Bitcoin Magazine, the article appeared in the Procuratorial Daily, an official publication tied to the Supreme People’s Procuratorate of China. It was written by two prosecutors from Yuhu District in Hunan Province and an associate law professor at Xiangtan University.
The authors argue that the decentralized, pseudonymous and cross-border design of virtual currencies has outpaced China’s current legal framework. In their view, the resulting challenges fall into three areas: defining the offense, gathering evidence and recovering stolen or seized assets.
A statutory gap sits at the center of the debate
The paper says there is a mismatch between existing laws. China’s Anti-Money Laundering Law has removed restrictions on which predicate offenses can qualify, but Article 191 of the Criminal Law still limits money laundering charges to seven categories of underlying crimes.
Because of that gap, the authors say, most crypto-related cases are handled under Article 312, which covers concealing criminal proceeds. They describe that provision as a catch-all in practice and call for broader use of the formal money laundering statute instead.
They also propose a “one case, two checks” principle. Under that approach, investigators in every major criminal case would also be required to examine whether laundering indicators are present.
Three proposals stand out
The first is what the article calls “blockchain self-authentication.” Public blockchain explorer records would be treated as reliable when their hash values match, and that match would preliminarily establish the integrity of the records.
The second proposal would shift the burden of proof after prosecutors submit a transaction-chain analysis report. Once that report is filed, the defense would need to disprove it.
The third proposal deals with intent. The authors say courts should be allowed to infer laundering intent from conduct alone. Under that standard, using mixers or privacy coins, selling large holdings at prices that diverge from market levels, or conducting high-value transactions through anonymous wallets with no clear source of funds could establish intent unless a defendant offers a reasonable rebuttal.
Evidence rules and technical measures are also part of the proposal
The paper says mixers, privacy coins and decentralized exchanges make tracing harder because they enable layered splitting and cross-chain transfers. Traditional methods, the authors write, often struggle to follow those paths.
To address that, they propose adaptive rules for electronic data, tiered standards of proof and clearer authorization for technical investigative measures such as real-time monitoring and traffic analysis. The paper also says those measures should come with limits aimed at protecting personal information and cybersecurity.
Asset disposal remains a separate problem
The authors identify asset recovery as another obstacle. Because crypto trading is banned in China, authorities that seize digital assets do not have a clear legal channel to liquidate them.
The paper recommends a national platform to store, value and dispose of confiscated crypto assets through compliant channels. It also calls for an expert committee that would set valuations using on-chain data and prices from international exchanges.
For funds moved overseas, the authors urge bilateral and multilateral agreements, along with a blockchain-based judicial cooperation chain to trace and freeze assets sent abroad.
Not legally binding, but directionally important
Bitcoin Magazine notes that the recommendations do not carry legal force. Still, they may indicate how Chinese courts could move in future crypto-related laundering cases.
The report cites Chainalysis data showing that Chinese-language laundering networks processed $16.15 billion in 2025, or about 20% of the global total. It also says Chinese prosecutors brought charges against more than 3,000 people in crypto-related laundering cases in 2024, underscoring the scale of the issue.
The original Bitcoin Magazine report was written by Micah Zimmerman.
