Chinese police have frozen the bank accounts of some cryptocurrencies and fiat money claiming to be linked to illegal activities. It is stated that this move may seriously affect thousands of OTC (over the counter) salesmen and customers.
Chinese cryptocurrency buyers and sellers and OTC market players’ accounts were frozen last Thursday. As a result, it was stated that the transactions made were used in money laundering movements, including cryptocurrencies.
According to CoinDesk’s report, Sun Xiaoxiao, a former employee of the Chinese crypto wallet initiative Bixin, now head of an OTC company, said on Friday that bank accounts of the bank accounts on the subject in social media application Weibo, known as China’s Twitter. He wrote that it was frozen and that this is not a personal situation. Xiaoxiao also stated that this investigation by the Guangdong district police affected thousands of people.
None of the cryptocurrency users affected by the operation has ever faced any charges. The question mark how much the fiat and cryptocurrencies affected by illegal activities or used in these activities constitute. OTC exchanges are the only entry and exit way for Chinese users without overseas bank accounts.
The reason for the police action is uncertain
It is still unclear what incident the Chinese police carried out this vast account freezing operation. In another detailed article he wrote on Friday, Xiaoxiao said the operation was related to frauds, chains of chains and casino business. Xiaoxiao also wrote that freezing individuals’ bank accounts is not unusual due to cryptocurrency.
There is a possibility that the police will find out if the funds have been used in activities such as money laundering in the past. So in the past, it was seen that the accounts of investors who converted their crypto money to yuan were frozen.
Xiaoxiao said, “Now, because of the doubts in the source of the coins they bought, bank accounts of OTC stock market operators are being frozen. This means that there are “dirty coins” in the system besides the dirty money. There is a trend to use the Blockchain network to transfer high-risk capital in China. In the past, the first choice for this business was Bitcoin, now it is USDT. As a result of this trend, the police are increasing their Blockchain knowledge. In more cases, in-chain analysis is done. This makes it easy to track Blockchain assets. ” said.
As a result of the Chinese Central Bank banning ICOs (the first supply of a digital currency) and breaking the withdrawal and deposit connections between the Chinese stock exchanges and banks in September 2017, Chinese citizens can transfer money from person to person, or to receive cryptocurrencies or cash in cryptos. OTC market makers are the only option when it comes to turning.
Xiaoxiao stated that people whose accounts have been frozen should apply to law enforcement agencies to prove their innocence and demonstrate their victimization, and the reopening of accounts will depend on the rigor of the operation.