Chinese prosecutors signal intent shift on crypto mixer use
Chinese prosecutors have proposed treating the use of crypto mixers and privacy coins as automatic evidence of money laundering intent, a shift that would lower the burden of proof for authorities and signal stricter enforcement.
China’s Supreme People’s Procuratorate has signaled a potential shift in how the country handles crypto-related financial crime by proposing that the use of mixers and privacy coins be treated as direct evidence of money laundering. The recommendations, outlined in the Procuratorial Daily by two Hunan Province prosecutors and an associate law professor at Xiangtan University, currently lack binding legal force but offer a clear blueprint for future prosecutions.
For market professionals, the most significant proposal is the reversal of the burden of proof. Under the framework, once prosecutors submit a transaction-chain analysis report, defendants would need to disprove it. Courts could also presume criminal intent solely based on conduct, such as using mixers, selling large holdings off-market, or moving high-value transactions through anonymous wallets without a clear source of funds.
The paper identifies a critical gap in China’s legal architecture. While the Anti-Money Laundering Law has broadened, Article 191 of the Criminal Law still restricts money laundering charges to seven predicate offenses. This forces most crypto cases into the catch-all provisions of Article 312. To resolve this, the authors advocate for a "one case, two checks" principle, requiring investigators to actively hunt for laundering indicators in every major criminal probe.
To support these prosecutions, the authors suggest treating public block explorer records as self-authenticating evidence if hash values match. They also recommend expanding authorization for real-time monitoring and traffic analysis to track funds across decentralized exchanges and cross-chain bridges.
The recommendations also tackle a practical bottleneck for Chinese authorities: liquidating seized assets. Because crypto trading is banned in the country, confiscated tokens currently sit in legal limbo. The paper proposes creating a national platform to store and dispose of these assets through compliant channels. An expert committee would determine valuations using on-chain data and international exchange prices.
These proposals arrive against a backdrop of massive illicit volume. According to Chainalysis, Chinese-language laundering networks processed $16.15 billion in 2025, accounting for roughly 20% of the global total. In 2024, Chinese prosecutors charged more than 3,000 people in crypto laundering cases. While non-binding, these recommendations indicate that Beijing is preparing to close the legal loopholes that have complicated its crackdown on digital asset crime.
