Wang Bin, chief judge of the Third Criminal Division of China's Supreme People's Court, said at a press conference on February 26 that courts will focus on cracking down on crimes related to money laundering via virtual currencies and underground banks. He stressed increasing property penalties so that criminals 'cannot profit economically.'
Crypto and Underground Banks Targeted
Wang specifically named money laundering through virtual currencies and underground banks as a key target, alongside leaders of criminal groups, core members, telecom fraud financiers, and human smugglers. Violent crimes during telecom fraud, such as murder, assault, and kidnapping, are also prioritized.
Stricter Property Penalties: Leniency for Restitution, Harshness for Refusal
Courts will apply property penalties more aggressively. Offenders involved in crimes related to 'two cards' (phone and bank cards) or money laundering can receive lighter sentences if they voluntarily compensate victims. However, those who can pay restitution but refuse will face tougher punishment — even if illicit funds have been converted into crypto assets.
Crypto Becomes Main Channel for Fraud Money Laundering
China's judicial system has been escalating actions. In August 2024, the Supreme Court and Supreme Procuratorate issued a judicial interpretation that for the first time listed 'virtual asset transactions' as a money laundering method. According to the Supreme Procuratorate, 3,032 people were prosecuted in 2024 for using virtual currencies to transfer criminal proceeds. As telecom fraud rings increasingly rely on stablecoins like USDT to move money across borders, crypto has become a major channel alongside underground banks.