- Renrenbit founder and Bitfinex shareholder Zhao Dong has received a seven-year prison term in China, part of the country’s ongoing crackdown on cryptocurrency operations
- Dong’s charges include illegal business operations and unauthorized foreign exchange trading, highlighting China’s shift in prosecuting evolving financial crimes
- The sentencing reflects China’s commitment to combat illicit activities in the cryptocurrency realm
Zhao Dong, founder of Renrenbit and a minor shareholder of Bitfinex, was recently sentenced to seven years in prison in China in another example of China’s continuing crackdown against cryptocurrency operations. China’s Supreme Procuratorate sentenced Dong following charges related to illegal business operations and unauthorized foreign exchange trading, with the effort to bring Zhao to book reflective of a new prosecutorial direction looking at new forms of illegal financial activities.
Dual-agency Task Force Nails Dong
The effort to prosecute Dong, a prominent figure in the over-the-counter (OTC) digital asset market and a Bitfinex shareholder, saw The Supreme People’s Procuratorate work in collaboration with the State Administration of Foreign Exchange. The two agencies targeted foreign exchange-related crimes, impacting Dong’s entrepreneurial ventures in the crypto domain, with his sentencing being part of a broader campaign by Chinese authorities to combat illegal financial activities, especially those with international dimensions.
The offenses range from fraudulent foreign exchange transactions to intricate financial scams, reinforcing the government’s firm stance against financial impropriety, with Dong’s case encompassing eight opened by the new task force.
In investigating Dong, Chinese authorities conducted thorough investigations, tracing complex financial transactions associated with these cases. The case against Dong and his associates was built on objective evidence, including bank statements, communication records, confessions, and witness testimonies.
Tackling a New Threat
China’s crackdown highlights emerging trends in foreign exchange crimes, where criminals employ sophisticated methods such as “counter-attacking” models to move funds independently, evading regulatory scrutiny. The use of virtual currencies and social media for illegal financial activities poses challenges for law enforcement agencies.
The collaborative effort between the Supreme People’s Procuratorate and the State Administration of Foreign Exchange underscores their commitment to financial security, with the two agencies hoping to create a high-pressure environment against illegal cross-border financial activities with the ultimate aim of ensuring the robustness and integrity of China’s financial system.
