In a groundbreaking move, China’s highest court and public prosecution agency have officially recognized crypto transactions in their revised anti-money laundering (AML) laws. This significant update, announced on August 19, marks the first time virtual asset transactions are explicitly listed as a method of laundering money.
Key Highlights of the New AML Interpretations
Starting August 20, the Supreme People’s Court and the Supreme People’s Procuratorate will enforce new interpretations of the AML laws. These changes include:
- Inclusion of Virtual Assets: Crypto transactions are now considered a means of concealing the source and nature of criminal proceeds.
- Penalties: Offenders face fines ranging from 10,000 Chinese yuan (around $1,400) to 200,000 Chinese yuan (around $28,000). Severe cases could result in jail time of five to ten years.
- Clarification of Regulations: The amendments provide clear guidelines for identifying money laundering crimes and the specific circumstances under which regulations apply.
Why This Matters
The amendments are a response to increasing crypto-related criminal activities in China. Earlier this year, Chinese Prime Minister Li Qiang called for a rewrite of the AML laws to include crypto transactions. Authorities have promised to crack down on the use of crypto and blockchain technology for criminal purposes.
What’s Next?
As China strengthens its regulatory framework, the global crypto community is watching closely. Will these changes lead to a broader acceptance of crypto in China, or will they further tighten the restrictions? Only time will tell.