According to a report by the South China Morning Post, Sun Shengbin of the Wenzhou Public Security Bureau and Lou Yandi of the Zhejiang Provincial Public Security Department's Criminal Investigation Corps published a technical paper on June 4 in the journal Criminal Technology (Xingshi Jishu). The paper systematically discloses for the first time the forensic tools and case-handling procedures used by Chinese police for virtual currency assets such as Bitcoin and Ethereum.
The paper covers the entire process: device seizure and cracking, evidence collection, on-chain transaction tracking, and asset freezing and seizure. Several methods are outlined. One key approach involves tracking transaction fees (miner fees) back to centralized exchanges like Binance, allowing police to obtain user data through legal channels. Authorities can request Know Your Customer (KYC) records from major exchanges such as Binance, OKX, and HTX via formal legal procedures.
For funds stored on exchanges, police can freeze accounts for up to six months, and the freeze period can be extended. The paper also emphasizes strict operational boundaries: investigators are prohibited from privately holding private keys. The principle of "separation of case handling and custody" must be adhered to, with comprehensive oversight and a clear chain of custody record maintained.
This disclosure indicates that Chinese law enforcement has developed a systematic technical and legal framework for virtual currency forensics, providing a significant reference for regulatory compliance in the crypto space.