China Aims For Cyber Crime Perpetrators Using Blockchain And Metaverse

Illustration of crypto handling in China. (photo: frepic)

JAKARTA - China's Supreme People's Procuratorate (SPP), the country's highest prosecutor authority, is targeting criminals who use blockchain and metaverse projects for illegal activities in an effort to deal with a spike in cybercrimes. SPP expressed concern over the increase in online fraud, cyber violence, and personal information violations.

SPP reports a significant increase in cybercrimes committed on blockchain and within the metaverse. Criminals are increasingly using cryptocurrencies for money laundering, making it difficult to trace their wealth associated with these illegal activities.

Ge Xiaoyan, deputy attorney general of the SPP, stated that allegations of telecommunication fraud related to cybercrime have increased by 64 percent on an annual basis. While blockchain-related crimes are on the rise, traditional crimes such as gambling, theft, pyramid schemes, and counterfeiting have also grown into cyberspace.

Xiaoyan stressed that allegations related to internet theft have increased by nearly 23%, while allegations related to counterfeiting and online sale of inferior goods jumped nearly 86%.

Prosecutors have indicted 280,000 individuals in cybercrime cases between January and November. This reflects an increase of 36% on an annual basis, which compiles 19% of all criminal crimes, as reported by Xiaoyan.

Zhang Xiaojin, director of the fourth SPP Procuracy, also warned citizens and digital asset participants about investment fraud in the local crypto economy.

Xiaojin highlighted the increase in new cybercrimes using the metaverse, blockchain, and binary option platforms, stating that digital currencies have become hotspots for these activities, stressing the need for higher vigilance.

China's efforts to eradicate crime related to digital assets are different from Hong Kong's. The special Chinese administrative area took a different approach by implementing crypto-friendly regulations to regulate its digital asset ecosystem and protect investors without hindering innovation.

People's Bank of China (PBoC) responded to issues related to regulated cryptocurrencies and decentralized finance in its latest financial stability report. China's central bank has prepared a separate section for crypto assets in the report, emphasizing the need for the industry to be regulated using joint efforts by different countries.

In 2021, PBoC officially announced measures to counter crypto adoption in mainland China, prompting stronger inter-department coordination in eradicating crypto activity in the country. While the ban includes nearly all crypto transactions and crypto mining, mainland China remains a large crypto mining hub to date.