China Cracks Down On $1.9 Billion Underground Bank Using USDT For Foreign Exchanges

The concept of global economic crisis. Illegal production of US dollars. Print money underground. Printing hundred dollar bills by a criminal.
  • China’s tough outlook on crypto has claimed another victim, with an illegal bank facilitating USDT transfers taken out yesterday.
  • Chinese police arrested 193 suspects in relation to the unlawful activity.
  • The bank had been responsible for over AU$2b worth of crypto transactions since starting in 2021.

The Chinese hardline stance on cryptocurrency transactions has yet again come to the fore, with a prolific black market institution being dismantled by authorities yesterday. The news comes just days after Chinese police busted another bank using crypto for foreign exchange. 

The nation’s crackdown on crypto started in 2021, slowly becoming a blanket ban preventing anything crypto-related whatsoever. Interestingly, Hong Kong has taken an alternate position, intending to become the Asian hub for crypto innovation and recently approving spot Bitcoin and Ether ETFs.

Related: North Korean Hackers Unleash New ‘Durian’ Malware to Target South Korean Crypto Firms, Reveals Kaspersky Report

ForEx and “Smuggling Medicine” Keys to Illegal Bank

The unlawful bank had reportedly been operating since 2021, around the time China’s sweeping bans on the crypto sector rolled in. For the most part, the institution used Tether USD (USDT) – a stablecoin pegged to the US dollar – to facilitate exchanging Chinese yuan for international currencies.


However, authorities also reported that the bank was predominantly used by other criminals to help smuggle medicine and other illegal goods overseas.

The bank allegedly facilitated some CNY$13.8b (AU$2.86b) worth of transactions over the past three years, and nearly 200 suspects were arrested all over China due to their potential involvement in the illegal activity.

Chengdu City Police’s report also claimed that authorities froze CNY$149m (AUD$30m) of assets held by those running the bank.

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Ben Knight

Ben Knight

Ben Knight is a writer and editor from Melbourne with a passion for all things music and finance. He enjoys turning complex topics – especially the technical details of cryptocurrency – into digestible bites that anybody can understand. He acquired his Master’s in Writing, Editing and Publishing from RMIT in 2019 and has run his own creative writing business ever since.

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