To combat increasing crimes in the digital arena, Chinese authorities are increasing their scrutiny over the Web3 sector. Notably, the nation has witnessed a surge in personal identity thefts and digital financial crimes lately.
In a press conference on Thursday, which was hosted by China’s Ministry of Public Security, Jinfeng Sun, political commissar of the Network Security Bureau, commented on the topic. He revealed that there has been a spree of incidents involving the use of Trojan viruses, phishing sites, infiltration tools and cyberstalkers in fraud and data theft. He added:
We have been monitoring [the use of] Chat GPT, cloud computing, blockchain, deep fake AI and other new emerging technologies, new applications, new organizations [in these incidents]. We [the Ministry] will strike hard at such methods as we research their use.
Adding some data, Sun disclosed that there had been 79 cases of fraud involving deep fake AI, such as impersonation via digital face-swap, leading to the arrest of 515 individuals. In a similar incident, on July 18, Shanxi Police arrested 21 individuals allegedly involved in a 54.8 million USDT money laundering scheme.
According to local media reports, the suspects allegedly bought USDT from Chinese residents for below-market value to sell them for fiat on oversea exchanges, banking in the difference while transferring their clients’ money abroad.
While China is particularly known to be anti-crypto, the recent concern regarding the increasing crimes comes out genuine. In December Todayq News reported that Chinese authorities arrested a gang of 63 members for laundering 12 billion Yuan ($1.7 billion) using crypto.
Additionally, three months prior to this, Hengyang Public Security Bureau arrested a gang accused of laundering 40 million Yuan using crypto. The alleged gang had been operational since 2018 and had committed over 300 electronic frauds.
Notably, the increasing crimes in crypto have been a nightmare for regulators across the globe. In the recent weeks, British regulators have also been gearing to enhance their efficiency to tackle crimes by recruiting for senior roles for crypto investigators.
Simultaneously, similar actions have been observed from South Korean regulators as well as the United States Department of Justice (DoJ). These nations are gearing up on their crypto related teams to ensure safety to customers.
Keeping up with its anti-crypto nature, China imposes strict exit controls on capital, with Chinese nationals prohibited from purchasing more than $50,000 worth of foreign currencies each year. However despite these strict controls, some have accused the Chinese police of embezzling funds from crypto projects through enforcement measures.
