Chinese Police Reveal A USD 54 Million USDT Money Laundering Scheme

Liputan6.com, Jakarta Police officers in China’s North Shanxi Province made 21 arrests in connection with an alleged USDT money laundering scheme worth more than USD 54 million.

USDT is an asset-backed stablecoin pegged to the US dollar and operated by Tether Limited Inc., a subsidiary of the Hong Kong-based company iFinex Inc.

Launching the Yahoo page, Wednesday (19/7/2023), police investigators allege that the suspects, who operate in 4 provinces, were involved in purchasing discounted USDT through over-the-counter crypto trading services since October 2021.

The accused then allegedly made illegal profits by selling tokens at higher prices through social media and money.

Police said the transactions totaled more than 54.8 million USDT (CNY380 million) over a nearly three-year period.

At the place of arrest, police found a total of 40 mobile phones, seizing more than 1 million yuan (USD 138,000) in USDT from the defendant’s account. They also confiscated over 200,000 yuan in cash.

All 21 suspects have admitted to the charges — including facilitating the conversion of Chinese yuan to USDT by cybercriminals — the case is still under investigation.

Police say USDT has become the top choice for cryptocurrency launderers because of the ease and anonymity of its transactions.

Even though China banned the issuance of cryptocurrencies in 2017 and then issued an outright ban on crypto transactions in 2021, Chinese citizens can still access cryptocurrencies through decentralized finance (DeFi) platforms and proxy internet servers.