- The Supreme People’s Procuratorate of China has initiated a crackdown on cybercrimes exploiting blockchain and metaverse technologies
- The changes come amid a surge in online fraud and personal data breaches, most notably “pig butchering” scams
- Deputy Prosecutor-General Ge Xiaoyan reported significant increases in cybercrime-related charges, including a 64% rise in telecom fraud
The Supreme People’s Procuratorate (SPP) of China has launched a concerted effort to combat the escalating wave of cybercrimes facilitated by blockchain and metaverse technologies. The SPP cited a worrying uptick in online fraud, cyber violence, and personal data infringement within blockchain networks and virtual reality environments, with wrongdoers increasingly exploiting cryptocurrencies for money laundering purposes, thereby complicating efforts to trace illicit proceeds. The actions were announced the same day as reports of a $100 million Chinese pig butchering scam came to light, with the proceeds laundered through USDT.
64% Year-on-year Fraud Increase
The SPP’s plans were disclosed by Ge Xiaoyan, its deputy prosecutor-general, who noted a staggering 64% year-on-year increase in cybercrime-related telecom fraud charges. Moreover, there has been a notable uptick in charges related to internet theft (up by nearly 23%) and online counterfeiting (up by almost 86%).
The Procuratorates have taken legal action against approximately 280,000 individuals implicated in cybercrime cases between January and November last year, representing a significant 36% surge compared to the previous year. These cyber offenses now account for nearly one-fifth of all criminal charges, underscoring the magnitude of the challenge facing law enforcement agencies.
Zhang Xiaojin, director of the Fourth Procuratorate of the SPP, has cautioned citizens and digital asset investors about the proliferation of investment scams within the local crypto ecosystem. Xiaojin has specifically highlighted the emergence of new cybercrimes leveraging the metaverse, blockchain, and binary options platforms, emphasizing that digital currencies have become prime targets for illicit activities, necessitating heightened vigilance from stakeholders.
$100 Million Pig Butchering Operation Identified
The news comes as investigations conducted by blockchain analytics firm Chainalysis in collaboration with the International Justice Mission (IJM) uncovered a sophisticated cryptocurrency scam perpetrated by a single Chinese company based in Myanmar. This operation, known as a “pig butchering” scam, has defrauded victims of over $100 million through the manipulation of false romantic relationships to elicit trust.
The scammers used Tether (USDT) to launder the funds, adding fuel to the fire that USDT is an increasingly popular tool for cybercriminals in the region. The identity of the Chinese company responsible for orchestrating the scams remains undisclosed to protect victims of human trafficking associated with the operation.
