Hong Kong is stepping up its efforts to fight crypto-fueled money laundering with the development of a new blockchain tracking system. In a joint initiative, the Hong Kong Customs and Excise Department is partnering with the University of Hong Kong to create a digital tool that can trace cryptocurrency transactions tied to illicit financial activity.

During a media briefing, Assistant Commissioner Mario Wong Ho-yin stressed the growing challenges posed by borderless financial crimes. He emphasized the need for collaboration between government agencies, financial experts, and academia, noting that no single entity can tackle the problem alone. Details about how the tool works remain classified due to operational sensitivity.

Hong Kong authorities have seen a notable increase in crypto-related laundering. Between 2021 and May 2025, the city recorded 39 major money laundering cases, seven of which involved cryptocurrencies. One investigation uncovered more than 1,000 suspicious transactions worth HK$1.8 billion (approximately $229 million), with three individuals arrested for using crypto to mask the flow of illicit funds across multiple companies and local bank accounts.

In parallel, the Customs Department and the University of Hong Kong held a three-day workshop with law enforcement and consular staff from eight jurisdictions — including China, India, and Singapore — to strengthen global cooperation in tackling digital financial crime.

Meanwhile, across the globe, U.S. authorities have charged Iurii Gugnin, founder of crypto platform Evita Pay, with laundering over $530 million through stablecoins linked to sanctioned Russian banks. The Department of Justice alleges Gugnin used the crypto network to help Russian clients evade sanctions and gain access to restricted U.S. technologies. If convicted, he could face life in prison.