Local governments in China explore the means of liquidating the cryptography entered, navigating in a legal gray area created by the country’s strict prohibition on trade and crypto scholarships.
According to A report of April 16 by ReutersThe absence of clear regulations on the management of confiscated digital assets has led to incoherent practices and raised concerns about transparency and corruption.
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Chinese authorities use private companies to sell offshore crypto seizure
Quoting the files of the courts and transactions, Reuters revealed that some local authorities have turned to private companies to sell assets in cryptography seized on the offshore markets. They then convert them into species to strengthen public finances.
These efforts would have generated significant income. At the end of 2023, local governments collectively held around 15,000 Bitcoin (BTC), worth around 1.4 billion dollars.
About 194,000 BTC is currently estimated worth $ 16 billion. This makes it the second largest national Bitcoin holder in the world, dragging only the United States, according to Bitbo data.
Chen Shi, professor at the University of Economy and Law of Zhongnan, said Reuters that the current approach is a “makeshift solution” and not entirely in accordance with the ban on cryptography coverage of China.
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China wants bitcoinThe question is still complicated by an increase in crimes related to crypto across the country, including fraud, illegal game and money laundering. In 2024, more than 3,000 people were continued for money laundering activities related to crypto.
Legal experts and industry initiates have proposed alternative strategies to manage assets. The lawyer based in Shenzhen, Guo Zhihao, suggested that Banque Populaire de China takes responsibility for the crypto seized and planned to sell it abroad or convert it to a national reserve.
Ru Haiyang, co-PDG of the Hashkey exchange based in Hong Kong, argued the idea, noting that China could follow the American example of using Bitcoin lost as a strategic asset.
Some also have launched the idea of Establishing a sovereign crypto fund in Hong Kong, where crypto trading is legally authorized. The debate occurs while American tensions – China increases and Donald Trump moves to strengthen Stablecoins monitoring while encouraging cryptographic innovation.
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Chinese citizens use offshore exchanges to exchange the crypto
Despite the national ban on crypto trade and mining in recent years, many Chinese citizens have continued to access digital currencies thanks to offshore exchanges, peer-to-peer platforms and VPNs. These bypass solutions made the application more complex.
As tensions develop on how cryptocurrency seized were to be managed, discussions between political decision-makers are intensifying. Legal experts suggest that the lack of clear national directives has led to incoherent practices and increased the risk of mismanagement or corruption.
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Main to remember
- Chinese local governments use private companies to sell offshore seized cryptography, which raises concerns about transparency and legal consistency.
- China holds around 194,000 BTC, But lack of clear national directives on the management of confiscated digital assets.
- Legal experts call For centralized surveillance or a sovereign crypto fund as the challenges related to the crime and the application of crypto crimes increase.
The local governments of La Poste plan to sell the crypto seized in the middle of the exchange of exchanges appeared first on 99Bitcoins.
