Chinese video platform employees received up to 14 years in prison for laundering $19,5 million in cryptocurrency

What’s new? In Beijing’s Haidian district, a former employee of an unnamed short video platform organized a scheme to embezzle 140 million Chinese yuan ($19,5 million) in rewards and converted the funds into cryptocurrency using overseas exchanges, leading to numerous arrests.

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What else is known? The former employee exploited loopholes in the reward system to illegally obtain funds. Collaboration with accomplices included the use of several foreign exchanges to launder the funds. For these actions, the organizer, and accomplices were sentenced to prison terms ranging from 3 to 14 years.

$22 billion has already been laundered through cross-chain bridges. How did this happen

Moving assets between different blockchains is massively used by hackers and scammers to hide the chain of cryptocurrency movement

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Several similar incidents have occurred in China in the past. In June, five citizens of China, the US, and Turkey pleaded guilty to facilitating the laundering of stolen funds through US shell companies.

The criminals lured funds from victims under the pretext of high-yield investments, then converted them into USDT stablecoins from Tether with the help of Deltec Bank, after which they cashed the cryptocurrency with various counterparties around the world. In this way, $36,9 million was laundered.

In the same month, the Beijing Police Department began selling the confiscated cryptocurrency through licensed crypto exchanges in Hong Kong. This is the first time a Chinese government agency has reported selling cryptocurrencies under the special digital asset regulation regime in place in Hong Kong, which is a special administrative region of the country.

Law enforcers have partnered with the China Beijing Equity Exchange (CBEX), which will be the counterparty in the chain of sales of confiscated cryptocurrencies.

China’s central bank will launch an international CBDC operations center

The initiative aims to expand the global influence of the digital yuan

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Mining, cryptocurrency trading, and crypto exchanges have been banned in mainland China since 2021, but authorities have recently begun to look more closely at digital assets. In addition, they are developing a central bank digital currency (CBDC) — e-CNY — which has been in development for more than six years.

In July, the Shanghai Asset Supervisory Commission began exploring the possibility of yuan-pegged stablecoins and held meetings with industry experts.

Earlier, China’s Central Bank Governor called for moving away from dollar dominance and starting to follow the global adoption of a multi-currency system based on the digital yuan.

Also, Ant Group, China’s largest fintech company and operator of Alipay, announced plans to introduce payments in stablecoins and applied for licenses in Singapore and Hong Kong.

In addition, it has been reported that China’s leading e-commerce platform JD.com has begun preparations to launch its own JD Coinlink stablecoin to reduce settlement times and costs for cross-border payments.