Chinese lawmakers are considering amending an earlier anti-money laundering law to strengthen the country’s ability to “monitor” and analyze money laundering risks through emerging financial technologies – including cryptocurrencies .
Wang Xiang, a spokesman for the Legislative Affairs Commission, announced the revisions on September 9 – citing the need to improve detection methods amid “the rapid development of new technologies.”
The proposed new legal provisions also call for central banks and financial regulators to collaborate on guidelines to manage risks posed by perceived money laundering threats from emerging technologies.
Wang noted that financial institutions will also be responsible for assessing the money laundering risks posed by new business models arising from emerging technologies.
On August 19, the Supreme People's Court—China's highest court—declared that virtual assets are a potential method for money laundering and tax evasion. According to the court's ruling:
“Virtual assets, transactions, methods of exchanging financial assets, transfers and conversions of proceeds of crime can be considered as ways to conceal the origin and nature of proceeds of crime”.
The ruling also stipulated that money laundering involving more than 5 million yuan by repeat offenders or causing monetary losses of 2.5 million yuan or more would be considered “serious conspiracy” and subject to more severe punishment.
The Chinese government has a well-documented hostility toward digital assets. In 2017, a Beijing market regulator ordered all virtual asset exchanges to shut down domestic services.
The subsequent government crackdown included foreign digital asset exchanges like Coinbase—which were forced to cease domestic services. This also sent Bitcoin prices plummeting to as low as $3,000.
Then, in 2021, the Chinese government began to take a tougher stance on cryptocurrencies by refocusing on domestic crypto activities.
The initiative calls for cross-agency cooperation between the People’s Bank of China (PBoC), the Cyberspace Administration of China, and the Ministry of Public Security to prevent and restrict the use of cryptocurrencies.
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According to Cointelegraph
