China, which views Bitcoin (BTC) and cryptocurrency transactions as illegal, sells millions of people with digital assets seized after detecting criminal operations. What’s going on is that the governments in their states are liquidating these cryptoactives and turning them into them to save their finances in a fierce era, while questions remain in the air and can China continue to ignore the power of digital currencies such as Bitcoin in a world that has already adopted them?
Since 2021, China has maintained strict bans on trade and cryptocurrency mining and has not recognized them as legal assets. but, Increase in cryptographic activity confiscated in criminal investigations He sought a practical solution from the local government.
According to Reuters, governments in cities such as Xuzhou and Taizhou will delegate the sale of these assets to private companies in international exchanges to repatriate funds to ease public funds that have been beaten by the current economic slowdown. However, the lack of a clear legal framework raises concerns about corruption, money laundering and the sustainability of this practice in the context of using digital assets to increase crime.
Chen Shi, a professor at Zhongnan Economic Law and Law College, warns that the practice is a “improvised solution” that contradicts the current ban. Additionally, at a recent seminar in Beijing, experts agreed that the lack of regulations poses a significant risk. “Without clear norms, cryptocurrency sales are fertile ground with irregularities,” says Liu Honlin, who specializes in Cryptoactive.
The rise of illegal activities related to cryptocurrency has led to China’s forfeiture. According to Safeis, a security company in the cryptocurrency ecosystem, money related to cryptocurrency crimes reached 43.07 billion yuan (approximately $59,000 million) in 2023, a 10-fold increase compared to past few years. These confiscations generated record tax revenues of 370 million yuan in 2024.according to official data.
Deep Shenzhen-based companies such as Jiafenxiang appear as key actors in this process. Documents reviewed by Reuters show the company Over 330 million yuan liquidation has been seized in cryptocurrency and is being sold on offshore platforms Deport your funds through a local bank.
What will you do with the millions seized in Bitcoin? The Chinese Dilemma
Abogados Como Guo Zhihao, de Beijing Yingke Law Firm, Creen Que Popular Chinese banks must take on a central roleto sell cryptocurrency in international markets or create a strategic preparation similar to that raised by the US government of Donald Trump.
On his part, Winston MA, former director of China Investment Co., Ltd., proposes emulating the Hong Kong model where digital assets are legal, allowing management to centralize under the sovereignty fund to maximize its value.
These ideas clash with China’s official position to maintain a strict line against cryptocurrency. However, the country faces a paradox. This is because China is already the 14th global fork in Bitcoin due to confiscation, according to the River Company, which is forced to rethink its strategy.
However, a chain data analysis by Cryptoquant CEO Ki Young Ju suggests that China could have liquidated 194,000 bitcoins that were confiscated in 2019 after dismantling the Ponzi Plustken scheme. These funds would have passed exchanges such as mixers and Huobi and would have been sold without official government confirmation. This potential mass sales reinforces the paradox. China has banned cryptocurrency, but its actions in the global market position it Like an important actor Ecosystems can push towards more open regulations in the future.
As Cryptonotics reported in February, the need for a clear regulatory framework to manage cryptographic actions is frequently raised, particularly for judicial cases that involve the issue of “national financial security.”
To achieve this, greater cooperation will be raised between regulators and judicial bodies. Meanwhile, a court decision made by the court made cryptocurrency recognized as a “virtual product” with real estate attributes, allowing ownership under certain conditions, while still unlawful for use in commercial transactions.
(TagStoTRASSLATE) Bitcoin (BTC) (T) China (T) Criptomonedas (T) Destacados (T) Marco Legal
