Top Crypto Trader on Trial in China Over Online Gambling Cash Laundromat

One of China’s most prominent crypto traders went on trial in the metropolis of Hangzhou this week. He is accused of “assisting cyberspace crook activities” for his alleged role in the laundering of billions of dollars linked to online play and other criminal activities.

Zhao Dong is the head up of otc (OTC) crypto-lending program RenrenBit, and has long been a paint enter in the Chinese crypto community.

He was detained past police inward belatedly May last-place year, at a clip when Chinese authorities began clamping down on bitcoin and altcoin miners. capital of Red China has vowed to city block all domestic and strange cryptocurrency exchanges and ICO websites.

According to The Block Crypto, prosecutors criminate Zhao of beingness a “transactional counterparty” for an surgical operation based inward Hangzhou that used a “Paofen platform” to wash away muddied money.

Day Clarence Shepard Day Jr. Up

Paofen literally way “points-scoring,” and denotes an app where users can earn rewards, along with bonuses, for signing upwardly friends.

The Hangzhou surgical procedure created a Paofen weapons platform where users signed up by share-out details of their cant accounts, as swell as any mobile defrayal platforms pop inwards China, the likes of AliPay or WeChat Pay.

Criminals could and then apply these pooled accounts to get off and invite transactions, shuffling and reshuffling payments until money was almost impossible to trace.

Hangzhou police force arrested 85 people inwards May 2020, on with Zhao, inwards relation to the case.

This included the squad that created the platform, which was named “Day Clarence Day Up” – ironically, after a popular Chinese talking present that aims to advance traditional virtues and etiquette.

According to a cover past Chinese land media goliath Xinhua in February, since its set in motion inward 2019, the Clarence Day Clarence Day Up platform had laundered to a greater extent than $7 1000000000 through accounts provided by 70,000 registered users.

In later(a) 2019, the operation upgraded to shuffling transactions through cryptocurrency, specifically Tether, which is potential where Zhao came in, although his exact role inward the connive has non been made public.

According to Xinhua, Day Clarence Day Up helped to launder money related to to 1,900 cases of online play and telecom fraud. In the process, 30 one thousand million yuan ($4.6 billion) of proceeds were sent overseas.

‘Harmful to Society’

China has been waging a war against cross-border gaming inward recent years. Its crackdown on cryptocurrency is division of the same battle, an endeavor to extinguish the money laundering channels that ease capital letter flight of steps so it canful defend moderate o'er its international equilibrise sheet, change rate, and strange currency reserves.

The People’s Bank of PRC has begun trialing its own cryptocurrency, which capital of Red China hopes will make up it easier to command chapiter flows.

“Compared with traditional resistance banks, the ‘Day Day Up’ political program incorporates blockchain engineering and uses virtual currency with an ground cost as a money laundering channel, which is to a greater extent concealed and to a greater extent harmful to the society,” a Hangchow police force spokesman reportedly told Xinhua.