Overview
- The Shanghai court on Wednesday sentenced five people to prison for operating an illegal foreign-exchange network that prosecutors say used cryptocurrencies to move more than 200 million yuan abroad.
- The convicted defendants received prison terms ranging from two and a half years to six years and fines from 300,000 yuan to 1.5 million yuan.
- Prosecutors said the probe began after the State Administration of Foreign Exchange flagged unusual transactions in July 2024 and identified a network whose domestic manager, surnamed Gao, processed about 170 million yuan before leaving to start a separate conversion business.
- Authorities said the group converted yuan into crypto and used on-chain transfers to hide flows, and prosecutors stressed that electronic records and blockchain traces were central to building the case while also warning such evidence can be fragile.
- The case forms part of a sustained enforcement drive since China banned commercial cryptocurrency activity in 2021 and comes as regulators step up actions against underground banking, with implications for OTC brokers, overseas property buyers and others who use informal channels to move funds.