Local governments in China are reportedly selling seized cryptocurrencies to generate revenue, despite the ongoing ban on crypto trading. As the economy slows, these governments are seeking to offload approximately 15,000 Bitcoins, valued at around $1.4 billion at the end of 2023, by using private companies to sell the assets in offshore markets. This activity has raised concerns about inconsistent handling of seized digital assets, potentially leading to corruption. Experts suggest that the central bank should oversee such transactions or even create a crypto reserve, while the rising prevalence of crypto-related crimes in China further complicates the situation. In 2024, the state pursued legal action against over 3,000 individuals for crypto-related money laundering, highlighting the growing urgency of the issue.

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