Chinese law enforcement is laying the groundwork for a new era in combating cryptocurrency crimes. An analytical article published on the official portal of the Supreme People's Procuratorate of the People's Republic of China proposes a radical overhaul of the approach to proving intent in money laundering cases involving digital assets.
New Standard of Evidence: Three Key Indicators
The essence of the proposal is to create a clear list of behavioral indicators that automatically point to criminal intent. If the accused cannot provide reasonable explanations, their guilt will be presumed. The list of such markers includes:
1. Use of tools to conceal transactions. The authors include crypto mixers and privacy coins in this category. According to their logic, the mere use of such services is sufficient grounds for suspicion.
2. Rapid disposal of large sums at "clearly non-market prices or in strange ways." Such behavior goes beyond normal logic of actions and indicates an attempt to launder illegally obtained funds.
3. Frequent large-sum transactions through anonymous wallets. This refers to vaults not linked to a public identity, where the owner cannot explain the origin of the funds.
On-Chain Data as "Self-Verifying" Evidence
Special attention in the article is given to the issue of collecting and verifying digital evidence. The authors propose introducing the principle of "self-verification of blockchain data." If an on-chain record can be verified through a public explorer and its hash remains unchanged, its authenticity is proposed to be "preliminarily recognized," shifting the burden of refutation to the defense.
Furthermore, prosecutors recommend granting reports from specialized blockchain analysis companies (fund flow diagrams, address link analysis) the status of expert opinions, which will significantly simplify their use in court.
The Problem of Asset Recovery
The authors acknowledge that serious difficulties arise in recovering digital assets. Conflicts over the legal nature of cryptocurrencies, procedural gaps, and barriers to cross-border cooperation hinder effective seizure. As a solution, they propose creating a unified national mechanism, including standards for asset seizure, storage, valuation, and disposal, as well as a national platform for their storage and sale through legal channels.
Expert opinion: This move by China is a logical continuation of its strict policy towards cryptocurrencies. However, the proposed approach with a presumption of guilt for using crypto mixers sets a dangerous precedent. It effectively criminalizes the technology itself, ignoring legitimate use cases (e.g., for business privacy protection). The market should be prepared for such legal constructs to be adopted by other jurisdictions, which will exert long-term pressure on the privacy sector.