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China Gears Up for Updated Crypto AML Laws: Report

China is reportedly planning to enhance surveillance over the burgeoning crypto sector, by amending its anti-money laundering (AML) laws to include crypto transactions.

A group of executives, chaired by Prime Minister Li Qiang discussed the ‘revised draft’ of the AML regulations on January 22. Per a local news report, the move marks the first major amendment to China’s AML rules since 2007.

The decision influenced by the growing concerns of policymakers in the country, primarily focuses on resolving crypto money laundering issues.

The amendment was first proposed in 2021, soliciting public opinion. Following this, the legislative work plan of the State Council included the revised draft in 2023.

The current amendment to the AML regulations is expected to be passed in 2025, Peking University professor Wang Xin noted.

China Battles to Combat Crypto Money Laundering Crimes

Xin stressed that the “most important, most urgent and most necessary” issue at the legal level is addressing the use of cryptos in money laundering.

China prohibited providing or receiving services for cryptocurrencies since 2021. However, the increasing trend of cryptos in money laundering crimes outperforms the already existing “strict prevention” of money laundering risks.

“Although the revised draft of the Anti-Money Laundering Law has included the prevention of virtual asset money laundering, there is a lack of operational guidance on the subsequent seizure, freezing, deduction, and confiscation of virtual asset money laundering crimes, resulting in a ‘disconnect’,” the professor added.

Yan Lixin, executive director of the China Anti-Money Laundering Research Center at Fudan University, emphasized the need for legal authorization.

Lack of legal authorization creates “grey areas,” law enforcement blind spots and difficulty in combating crypto use for money laundering. Additionally, Lixin noted that “there is still room for improvement” in the judicial relief work in China’s AML rule enforcement.

Hong Kong’s Securities and Futures Commission (SFC) introduced a similar amendment to its AML regulations, in April 2023. In October, the regulator announced plans to update its framework on cryptocurrency sales and requirements.

The post China Gears Up for Updated Crypto AML Laws: Report appeared first on Cryptonews.

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