China’s Supreme People’s Procuratorate has vowed to crack down on criminals who are exploiting blockchain technology and metaverse projects for illegal activities.
During a press conference on February 23, Li Xuehui, a spokesperson for the Supreme People’s Procuratorate, highlighted the rise in cybercrime within blockchains and the metaverse. Xuehui pointed out that cryptocurrency money laundering has become a popular method for criminals to accumulate illicit wealth.
Zhang Xiaojin, the Director of the Fourth Procuratorate of the Supreme People’s Procuratorate, warned against investment scams that promise high returns with low risks in the local crypto market. He urged citizens and participants in the digital asset sector to stay vigilant against evolving criminal tactics, such as the “pig butchering” scheme.
“Pig butchering” involves luring victims into investing in fraudulent digital asset projects or exchanges before disappearing with their funds. Last year, U.S. authorities seized over $9 million in Tether’s USDT stablecoin linked to this scam.
In 2023, Chinese authorities cracked down on more than 42,000 individuals involved in electronic fraud and crypto-related scams.
In response to the surge in illicit activities, China has intensified its efforts to combat blockchain-related corruption and bribery cases. This crackdown aligns with the spike in crypto crime in Hong Kong, which has tripled since 2021, according to crypto.news.
While Hong Kong has been facing increased crypto-related challenges, the region has also been working on implementing crypto-friendly regulations to safeguard investors and foster innovation. Hong Kong has introduced a licensing system for compliant businesses and is considering allowing spot Bitcoin ETFs to trade on local exchanges, following the approval of 11 issuers by the U.S. SEC.
Despite the ban on crypto trading and mining in China since 2021, the country has been making progress in central bank digital currencies (CBDCs) and web3 regulatory frameworks.
In another development, China has enlisted tech giants like Tencent, Huawei, and Ant Group to collaborate on a metaverse working group, signaling the country’s growing interest in exploring virtual reality technologies.
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