Qiu Moumou, the alleged mastermind, and prime suspect, is now facing trial after two years of trial by the authorities. Gambling has been illegal in the People’s Republic of China since 1949.
Chinese authorities have announced the first cryptocurrency confiscation case in the country through a court ruling.
According to a report, an investigation by Chinese police has uncovered a large-scale cross-border online gambling case with a turnover of 400 billion yuan (approximately $56 billion). A cryptocurrency was found to be at the center of the operation, facilitating illicit activities.
The police stated the following:
“According to preliminary investigation on this online gambling case, the amount involved reached 4000 billion, there were more than five people involved, the server was installed overseas, the method of funds laundering used the most difficult virtual currency and the backbone case may be abroad.”
This development marks a milestone in China’s continued efforts to crack down on illicit activities involving cryptocurrencies. The government has been progressively tightening regulations on cryptocurrency trading since 2017.
A Famous Cryptocurrency Case in China
The case initially came to light on July 28, 2021, when Xiong Xong, a resident of Shayang County in Hubei Province, reported his involvement in mobile phone gambling to the Jishan Police Station.
The simple case of mobile gaming took an ominous turn when Xiong observed his colleagues raking in substantial sums of money. The compelling lure of wealth slowly transformed the mobile gaming experience into something sinister.
After downloading the game app, Xiong experienced initial success and earned thousands of yuan. However, his luck worsened as he increased his bets, ultimately leading to losses that exceeded 100,000 yuan ($14,000).
As a result of a thorough investigation, the Chinese authorities allegedly uncovered a large-scale international criminal network that used cryptocurrency to obfuscate its illicit activities. Local reports suggest that this use of cryptocurrency made it extremely difficult for authorities to trace the origin of the funds and understand the full scope of the operation.
Subsequently, a significant event led to the arrest of people in multiple provinces, dismantling 14 suspected criminal gangs. More than 130 people were detained and authorities confiscated computers, mobile phones and bank cards as part of the operation. Local police have described it as the first virtual currency recovery case in the country.
Qiu Moumou, the alleged mastermind, and prime suspect, is now facing trial after a two-year effort by the authorities.
China Banned All Cryptocurrency Transactions in 2021
Gambling has been illegal in the PRC since 1949. In September 2021, China officially declared all cryptocurrency trading illegal. Despite the initial ban on cryptocurrency trading in 2019, trading activities persisted through currency exchanges.
Following the mainland ban, Hong Kong, a special administrative region of China, took a different approach by taking steps to establish itself as a hub for digital assets.
To date, investors and companies have cautiously approached entry into the city region. The Chinese authorities are well known for taking sudden crackdowns on industries the Communist Party dislikes. However, this ban has not deterred millions of Chinese from continuing to interact with cryptocurrencies.
By Audy Castaneda
