China’s new approach to crypto regulation could intensify the fight against crypto crime. We break down what’s known as of today.
China’s Supreme People’s Procuratorate has published recommendations for combating money laundering through cryptocurrencies. An article in the official Procuratorate Daily proposes that using mixers and privacy coins should be considered evidence of criminal intent.
Hot topic: Strategy Sells $467 Million in MSTR Stock — But Buys No Bitcoin
The authors–two prosecutors from Hunan Province and a law professor–argue for changing how digital crimes are investigated and updating evidentiary standards.
Contents
Presumption of Guilt Could Become the New Standard in Chinese Crypto Regulation
The prosecutors point to a mismatch between blockchain technology and current legislation. Most crypto-related cases are currently treated as “concealment of criminal proceeds.”
The authors call for applying the stricter money laundering statute and propose a “one case — two checks” principle, requiring investigators to look for money laundering indicators in every major crime investigation.
Three key proposals are being introduced:
- Blockchain self-identification: Information from public blockchain explorers would be considered reliable by default if the hash data matches.
- Shifting the burden of proof: If prosecutors provide a transaction chain analysis report, the defense would need to disprove it.
- Presumption of guilt: Using mixers, privacy coins, or selling assets at non-market prices would be sufficient grounds to establish money laundering intent.
The initiative has no legal force but sets the stage for professional discussion and reflects the direction China’s legal system may take on crypto.
Read more: The End of Crypto Privacy? How Global Regulations Are Changing Everything in 2026
Confiscation of Digital Assets and International Cooperation
The Procuratorate noted difficulties in seizing crypto assets. With digital asset trading banned in China, authorities have no legal channels to liquidate them. The authors proposed creating a state platform for storing and valuing confiscated coins. A special expert committee would value assets using blockchain data and international exchange prices.
China also plans to initiate international protocols for tracking and freezing crypto assets through judicial cooperation with other countries. This could include cross-border transactions and a blockchain-based judicial cooperation chain for tracing and recovering assets moved abroad.
China as a Money Laundering Hub
According to Chainalysis, Chinese-language money laundering networks processed $16.15B in 2025–roughly 20% of the global total. In 2024, Chinese prosecutors brought charges against more than 3,000 people in crypto-related money laundering cases, highlighting the scale of the problem. Despite banning crypto trading and Bitcoin (BTC) mining in 2021, China remains a major center for crypto laundering.
Learn more: China Crypto Regulation — Why Bitcoin Is Effectively Banned in the World’s Largest Market
