Chinese authorities in Sichuan and Chongqing have uncovered an extensive money laundering network operating with tether (USDT). According to information released, around 193 suspects were detained in an action that covered 26 provinces in the country. The illegal operation is suspected of moving approximately 13.8 billion yuan (US$1.9 billion), using cryptocurrency to circumvent exchange rate restrictions imposed in China.

The investigators highlighted that individuals involved in the network used USDT to facilitate international financial transfers in a clandestine manner, thus allowing capital to be sent out of Chinese territory illegally. In addition to violating foreign exchange laws, the gang is also being accused of involvement in a range of other financial and smuggling crimes.

During police raids carried out in 2023, authorities managed to dismantle two central gang operations located in Fujian and Hunan provinces. In these locations, it was possible to freeze 149 million yuan (approximately US$20.6 million) directly associated with the laundering scheme.

In addition to activities in China, the use of USDT extends to international smuggling operations, including gold trafficking between Nepal and Tibet. Criminals used cryptocurrency to pay smugglers who transported up to 33 kg of gold to Nepal, returning with cash, musk and yarsagumba, a highly prized medicinal fungus.

The complexity and breadth of the operation reveal the role of USDT as a crucial element in a “shadow banking system” used by organized crime, as highlighted by a United Nations report. This highlights that, especially in Southeast Asia, illegal gambling platforms have become one of the main means for money laundering through cryptocurrencies.


The views and opinions expressed by the author, or anyone mentioned in this article, are for informational purposes only and do not constitute financial, investment or other advice. Investing in or trading cryptocurrencies carries a risk of financial loss.


Leave a Reply