Categories: Global Adoption

China Classifies Crypto Transactions as Money Laundering in Update to AML Law

On Monday, Chinese authorities explicitly recognized “virtual asset” transactions as a method of money laundering, marking the first instance in the country that such a move has been made towards the asset class. The Supreme People’s Court and the Supreme People’s Procuratorate, the country’s highest judicial bodies, jointly announced the changes during a press conference. 

The measures, expected to take effect on Tuesday, are part of broader efforts aimed at tightening anti-money laundering laws, including specifically targeting the use of crypto in illicit financial activities.

The new legal interpretation classifies virtual asset transactions, including those conducted through crypto exchanges, as acts that “cover up and conceal the source and nature of the proceeds of crime.” 

Chinese authorities will now consider laundering amounts over 5 million yuan ($685,000) or causing losses of more than 2.5 million yuan ( $343,000) as serious offenses under the law. The thresholds ensure that large-scale money laundering operations face stricter legal scrutiny and harsher penalties.

If convicted and sentenced to fixed-term imprisonment of up to five years, or if given criminal detention, individuals face a fine of no less than 10,000 yuan ($1,370).  For sentences ranging from five to ten years, the individual will be fined at least 200,000 yuan ($27,400) in addition to their imprisonment.

Terron Gold

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