China has remained one of the countries with the most international criminal activities related to the flow of cryptocurrencies. While the crime rates have declined since the third quarter of 2019, a recent report has found that China still represents a disproportionate amount of illicit activities such as money laundering and fraudulent schemes in the crypto space. Putting it at the top despite the decline of illicit activities.
Analysts reported on August 3 detailing the number of transactions carried out on Chinese addresses, all of them associated with illicit activities. According to the report, more than $2.2 billion worth of crypto assets has flowed from Chinese wallets to addresses between the April of 2019 and June 2021.
In contrast to the inflows of large crypto assets worth $2 billion related to illicit activities, the report added that crime rates have declined significantly over the years. In terms of raw value and relation to other countries, China’s transaction volumes have decreased drastically over the years. The report also specified that the decline in crime rates was mostly due to the lack of Ponzi schemes such as the 2019 PlusToken scam.
Analysts have argued that while crypto-related crimes in China have fallen drastically, the country still remains one of the top-ranked nations for illicit transaction volumes. Implying that China has surpassed other nations by a broader margin.
The reports elaborate on the manners of the illicit crypto flows in China, stating the majority of the crypto flows were related to scam activities even though money laundering is still at large. Moreover, the author of the report suggested that China’s over-the-counter Bitcoin brokers have played a huge role in facilitating money laundering schemes related to cryptocurrencies.
Analysts have noted that China’s central government is responsible for more for conducting over 1,100 arrests in crimes related to cryptocurrencies. Most of the crimes were related to money laundering schemes in June. High figures indicate the willingness of the authorities to continue the crackdowns in the crypto space.
While the report indicated china’s hostility towards crypto assets and its widespread adoption into digitalized yuan, analysts speculate that it might result in adverse effects. China’s increasing movements to crack down on traditional decentralized digital assets may in fact undermine the country’s status as a leading crypto superpower nation in the world.
