First Tether Money Laundering Case Detected in China
In China, gambling sites launder criminal money through stablecoins
The attackers managed to launder about $ 18 million in a year and a half
Police believe there are about 3,000 stablecoin money laundering intermediaries in China
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Chinese law enforcement reveals first money laundering scheme with Tether, largest stablecoin by market cap
Stablecoins – Stablecoins – literally translated from English – continue to gain popularity in the digital asset market. With … More Tether (USDT) is used for money laundering. This is the conclusion reached by the Chinese police in the Huizhou City District, revealing money laundering schemes using USDT in digital casinos. According to local correspondent Colin Wu, the attackers developed the three gambling sites Heng X VIP Club, Russian X Casino and Italian VIP Club by purchasing foreign servers. The actual laundering, however, is the responsibility of a separate intermediary studio that mixes fiat money with USDT..
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The main scheme of money laundering with USDT is as follows:
- attackers (owners of gambling sites) buy USDT for dirty money through an intermediary;
- the intermediary, instead of the actual USDT, issues “dirty” vouchers that can be used to receive tokens;
- players buy dirty vouchers from cybercriminals for clean money to replenish the balance on a gambling site.
According to preliminary information, 77 suspects were arrested within the framework of the criminal case. It is estimated that there are over 3,000 stablecoin money laundering “hotspots” throughout China.
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Wu claims that the attackers processed large amounts of money through such dummy schemes:
“Private accounts can handle large amounts of money from online gaming platforms in large quantities, and the stolen money will eventually be laundered.”.
The now closed intermediary studio managed to work for almost a year and a half and processed about $ 18 million. Despite the active use of digital financial assets in illegal activities, the token issuers themselves strictly regulate the turnover of funds in accordance with international standards. Earlier, for example, the editorial staff of BeInCrypto reported that the issuer of Tether blocked more than 39 addresses with USDT tokens at the request of law enforcement agencies..
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