Chinese authorities have ramped up efforts to prosecute cryptocurrency-related crimes, sentencing a former tech executive to over 14 years in prison for embezzling 140 million yuan (approximately $19.5 million) from his employer.
According to a , the Beijing Haidian People’s Procuratorate found that Feng converted the stolen funds into Bitcoin and other cryptocurrencies using eight overseas trading platforms, and deployed a coin-mixing strategy to hide the origins of the funds.
After laundering the assets, Feng and his accomplices converted portions of the crypto back into yuan and funneled the funds into bank accounts in mainland China. Interestingly, the Chinese law prohibits crypto trading, and the country’s banking sector is banned from providing services related to virtual currencies.
The case was meticulously reconstructed by prosecutor Li Tao, a member of the Haidian Procuratorate’s hi-tech crime division. Authorities pieced together how the money was siphoned, laundered, and distributed among the conspirators.
As part of the sentencing, the court ordered Feng to surrender 90 hidden bitcoins, currently valued at more than $11 million.
Shenzhen authorities recently a public alert warning against illegal fundraising operations disguised as stablecoin and crypto investments. These scams, often run by unlicensed entities, are accused of luring citizens into fraud, gambling, and pyramid schemes, while taking advantage of limited public understanding of blockchain terminology.
Officials reminded the public that those who invest in such schemes could face personal legal liability, and they urged people to report suspicious actors.
This crackdown has created a for local governments across China: they are struggling to deal with a large stockpile of seized crypto assets, which they cannot legally trade within the mainland. As a result, many jurisdictions have decided to sell confiscated tokens on overseas exchanges, particularly in Hong Kong, where crypto trading is permitted.
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