Authorities are targeting systemic loopholes in large-scale money laundering cases. Bitcoin liquidity in the market has decreased, but this does not create systemic risks. Analysts note that undisclosed Bitcoin could directly influence future regulatory measures.

The Zhimin Qian Case

47-year-old Chinese national Zhimin Qian received an 11-year and 8-month prison sentence in the UK’s largest cryptocurrency money laundering trial. Qian admitted acquiring criminal proceeds in Bitcoin and other crypto assets. Between 2014 and 2017, he raised roughly $5.6 billion from more than 128,000 investors through his Chinese company, Lantian Gerui.

Authorities stated that most of the funds were embezzled and transferred through complex crypto transactions, leading to one of the largest Bitcoin seizures in UK history, totaling approximately 61,000 BTC.

In 2017, Qian fled China, traveled across Southeast Asia, and entered the UK using a fake identity and a St. Kitts & Nevis passport. In London, he rented luxury properties and tried to convert crypto funds into tangible assets such as real estate. Authorities seized Bitcoin stored in digital wallets and safety deposit boxes in York in April 2024.

Judge Sally-Ann Hales highlighted that Qian orchestrated the crime from start to finish, calling it “unprecedented in scale.” His accomplices also received prison sentences. The case emphasizes the complexity of large-scale crypto crimes and international money laundering operations.

Market and Regulatory Impact

According to CoinMarketCap, Bitcoin holds a 58.51% market dominance and traded at $90,904.55 with a -32.46% 24-hour volume change. Over the last 90 days, its price fell by 16.22%.

The case underscores the need for transparency in the cryptocurrency market. Authorities plan to enhance international cooperation to prevent similar incidents. Coincu analysis suggests that such major seizures could have long-term effects on Bitcoin’s price and adoption.

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Approved on June 14, 2025, the Law on Digital Technology Industry brings crypto assets under regulatory oversight and offers incentives for cutting-edge sectors like AI and semiconductors.

Crypto Assets Officially Recognized

Vietnam’s new legislation categorizes digital assets into two types: virtual assets and crypto assets. These classifications exclude securities, fiat currencies, or financial instruments. The law mandates the government to define operational rules, business conditions, and supervision methods for these asset classes.

Crucially, the bill introduces anti-money laundering and cybersecurity safeguards in line with global standards, aiming to address the FATF’s concerns. Vietnam has been on the FATF “gray list” since 2023, and this law could be a significant step toward removal.

Incentives Beyond Crypto: AI and Infrastructure Focus

The law goes beyond cryptocurrencies. It offers tax relief, land-use advantages, and R&D funding for companies working on core technologies such as AI, semiconductor design, and digital infrastructure. Regional authorities will also invest in workforce development and update national education programs to include digital skills.

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According to the Vietnamese government, this marks the world’s first comprehensive standalone law dedicated to the digital technology industry.

Rising Scams in the Crypto Market

With rising crypto adoption, scams have become more frequent. In February 2025, four people were arrested for running a fake crypto mining platform called BitMiner, posing as a Dubai-based firm. They defrauded over 200 individuals of 4 billion Vietnamese dong (about $157,300).

In another high-profile case from December 2024, a company named Million Smiles lured 100 companies and 400 individuals into investing in a fake cryptocurrency, QFS, using misleading claims tied to ancestral treasures. Losses reached over 30 billion dong ($1.17 million).

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VASPs Under Regulatory Scrutiny

In its 2025 NRA report, Luxembourg has classified Virtual Asset Service Providers (VASPs) as high-risk entities for money laundering. This risk is attributed to transaction volume, global client reach, legal structures, and the cross-border nature of crypto operations. The country had previously warned about the sector in its 2020 and 2022 reports, citing the digital and borderless characteristics of crypto assets as major vulnerabilities for financial crimes.

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The European Union is actively implementing the MiCA (Markets in Crypto-Assets) regulation to harmonize crypto laws across its 27 member states. Since January, crypto companies have begun obtaining licenses to operate legally. In May, Kraken launched regulated crypto derivatives trading, and Crypto.com secured a similar license. However, not all players comply—Tether (USDT) refused to align with MiCA’s rules and was consequently delisted from Binance, Coinbase, and Crypto.com across EU platforms.

Crypto’s Role in Money Laundering Grows

With crypto’s increasing role in global finance, it’s also becoming a tool for illicit activity. Earlier this month, Hong Kong authorities arrested 12 individuals for laundering $15 million using over 500 bank accounts and cryptocurrency. Meanwhile, in Europe, 17 suspects were detained in connection with a “mafia crypto bank” accused of laundering €21 million ($23.5 million). Authorities seized over $5 million in cash, crypto, firearms, and luxury vehicles during the crackdown.

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500 Accounts, One Crypto Scam

Twelve individuals were arrested across Hong Kong and mainland China in connection with a laundering ring that used over 500 bank accounts to funnel illicit funds into crypto. Fraud proceeds were routed through these accounts and converted into digital currencies at local crypto exchange shops.

Authorities discovered the group had been operating out of a residential flat in Mong Kok, turning the location into a base for planning and executing their illegal activities. Over $1.2 million was tied to 58 known fraud cases.

Busted in Real Time

On May 15, two suspects were observed leaving the Mong Kok base — one went to a bank, the other to an ATM. Both then attempted to convert the cash into crypto in Tsim Sha Tsui. Police arrested them on the spot, seizing nearly $98,540 before the money could be laundered.

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Soon after, 10 more people aged between 20 and 41 were arrested. In total, police confiscated $134,370 in cash, more than 560 ATM cards, mobile phones, bank documents, and records of crypto transactions.

According to Senior Inspector Tse Ka-lun, many suspects used bank accounts opened under friends’ or family members’ names to facilitate the laundering process.

Hong Kong Ramps Up Crypto Oversight

This case emerges as Hong Kong rolls out a more robust regulatory framework for the crypto industry. In April, new rules for exchanges offering staking services were introduced, followed by a comprehensive crypto roadmap in February focusing on compliance, infrastructure, and investor protection.

As Bitcoin, Ethereum, and other digital assets grow in appeal, so does the need for tighter security and regulation. Hong Kong’s proactive approach signals its intention to be both a hub and a safe haven for crypto innovation.

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How Did Telegram Shut Down Haowang Guarantee?  

Telegram banned all Haowang Guarantee accounts, channels, and NFTs. The platform served scammers in Southeast Asia, processing $27 billion in Tether’s USDT. Elliptic’s July 2024 report triggered the operation. Haowang was notorious for money laundering and “pig butchering” scams. Despite signs of fraud and USDT laundering, its groups and channels operated on Telegram for years. Following a Wired investigation exposing the scale of P2P crypto fraud, Haowang lost its Telegram presence.  

The platform stated, “As all our NFTs, channels, and groups were blocked by Telegram on May 13, 2025, Haowang Guarantee will cease operations.”  

Xinbi Guarantee: A New Threat  

Elliptic revealed that Telegram-based Xinbi Guarantee processed $8.4 billion in USDT transactions. Active since 2022, Xinbi saw $1 billion in inflows in 2024. Telegram also deleted Xinbi-linked accounts. However, criminal networks are shifting to new markets like Tudou Guarantee. Experts warn that these shutdowns may not fully resolve the issue. Elliptic’s co-founder Tom Robinson said, “This is a cat-and-mouse game. These are big mice,” noting that crime syndicates may move to new platforms or less-regulated messaging services.  

What Is Telegram Doing Against Crypto Crime?  

Telegram is proactively combating crypto crime, halting Haowang and Xinbi’s combined $35 billion transaction volume. Countries like Australia and Germany are also cracking down on similar platforms. Platform swiftly closes accounts violating its terms of service. However, experts caution that criminals may find new avenues.  

Similarly, Australia blocked over 90 scam platforms, and Germany shut down eXch, linked to the Bybit attack. The fight against crypto crime is intensifying.  

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Why Was the eXch Exchange Targeted? 

Operating since 2014, eXch allowed transactions without user identity verification (KYC), making it attractive to cybercriminals. The BKA reports that the exchange facilitated $1.9 billion in transaction volume, enabling money laundering and hack-related activities. Connections were identified with the $1.4 billion Bybit hack and the Genesis Creditor theft. The operation resulted in the seizure of the platform’s servers and 8 terabytes of data. 

Operation Details 

Germany collaborated with international law enforcement agencies. The seized assets include Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC), and Dash. This marks the third-largest cryptocurrency operation in BKA history. The platform has been completely shut down, and user data is now in the hands of authorities. This development highlights the accelerating global fight against crypto crimes. 

This operation serves as a clear warning to cryptocurrency exchanges. Platforms that fail to comply with KYC and AML regulations are on the authorities’ radar. Blockchain security and regulatory compliance are now more critical than ever. Germany’s move could set a precedent for other countries. 

Senior prosecutor Benjamin Krause, commenting on the seizure, emphasized “the importance of acting against fast and anonymous opportunities for money laundering of any amount.” 

“Crypto swapping is a fundamental component of the underground economy. It is used to conceal criminal proceeds from illegal activities such as hacking or trading stolen payment card data, thereby enabling perpetrators to access these funds,” he said. 

Authorities are leveraging technology to eliminate the anonymity advantage for criminals. Cryptocurrency users, meanwhile, should prioritize trusted and regulated platforms. 

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In a rule proposal released on May 1, the Treasury’s Financial Crimes Enforcement Network (FinCEN) urged US banks to terminate correspondent and payable-through account services for Huione.

Deputy Treasury Secretary Scott Bessent described Huione as the “marketplace of choice for malicious cyber actors,” accusing it of aiding the theft of billions from ordinary Americans.

$4B Laundered, USDH Highlighted

According to FinCEN, Huione laundered over $4 billion in illicit funds between August 2021 and January 2025, including at least $36 million from crypto “pig butchering scams” and $37 million directly linked to North Korean cyberattacks.

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Its online service Haowang Guarantee has turned Huione into a one-stop crypto laundering hub, offering illegal goods and converting crypto to fiat currency.

FinCEN also flagged Huione’s stablecoin, the USDH (US dollar Huione), for its unfreezeable nature, which allegedly supports laundering operations.

Indirect US Bank Access and Regulatory Action

While Huione doesn’t hold direct accounts with US banks, FinCEN revealed it maintains accounts with foreign intermediaries that do, giving it indirect access to the US financial system.

The National Bank of Cambodia revoked Huione’s local banking license in March 2025, citing digital asset violations.

The proposed rule will undergo a 30-day public comment period before potentially being finalized.

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Southeast Asia Becomes Crypto Crime Hotspot

One case highlighted is Huione Guarantee (now rebranded as Haowang), a Chinese-language platform operating out of Phnom Penh, Cambodia. Over the past four years, it has facilitated over $24 billion in crypto linked to fraud and scam operations, growing to over 970,000 users.

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The platform has launched its own crypto exchange, blockchain (Xone Chain), online gambling services, and even a US dollar-backed stablecoin aimed at bypassing government oversight. In February 2025, the group unveiled a Huione Visa card.

Billions Of Dollars Laundered Through Custom Coins And Exchanges!

The report warns that criminal groups in Myanmar, Laos, and Cambodia are industrializing cybercrime with AI, blockchain, and stablecoins, executing phishing, fake investments, and romance scams — collectively known as pig butchering — on a massive scale.

Recent crackdowns in Hong Kong, Nigeria, and other countries have led to hundreds of arrests. In October 2024, 27 people were arrested in Hong Kong for running a deepfake-powered crypto scam worth $46 million. In December, 792 suspects were caught in Lagos, Nigeria.

The UN warns these groups are leveraging their own stablecoins and private exchanges to circumvent AML laws and move funds freely across borders. The threat is growing beyond Asia — into Africa, South America, and the Pacific.

Governments are urged to close loopholes and prepare for this expanding form of financial crime.

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They expressed alarm over DOJ’s lack of attention to crypto mixers, labeling them as “essential tools for cybercriminals.”

DOJ Says It’s Not a Regulator

On April 7, DOJ official Todd Blanche defended the shutdown with the claim:

“The Department of Justice is not a digital assets regulator.”

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Democrats disagreed strongly, stating that a passive stance toward technology used in major crimes is “nonsensical.” They also cited DOJ’s apparent refusal to pursue Bank Secrecy Act violations, creating what they describe as a systemic vulnerability in the digital asset space.

Trump Family’s Crypto Links Under Scrutiny

The senators also pointed to potential conflicts of interest involving Donald Trump and his family. According to the letter, the DOJ’s actions may be tied to Trump’s crypto ambitions.

The Trump-backed World Liberty Financial is launching a stablecoin, while Eric Trump and Donald Trump Jr. are planning a new crypto mining company, American Bitcoin.

In the letter, they wrote:

“Your decisions give rise to concerns that President Trump’s interest in selling his cryptocurrency may be the reason for easing law enforcement scrutiny.”

They requested a full staff-level briefing from the DOJ by May 1 to explain the rationale behind the closure.

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Which Addresses Were Removed?

According to the updated SDN list, the following Ethereum wallet addresses are no longer subject to sanctions:

• 0x12D66f87A04A9E220743712cE6d9bB1B5616B8Fc
• 0x47CE0C6eD5B0Ce3d3A51fdb1C52DC66a7c3c2936
• 0x910Cbd523D972eb0a6f4cAe4618aD62622b39DbF
• 0xA160cdAB225685dA1d56aa342Ad8841c3b53f291
• 0xD4B88Df4D29F5CedD6857912842cff3b20C8Cfa

Additionally, Tornado Cash’s official website has also been removed from the sanctions list. This decision has sparked widespread attention in the cryptocurrency industry and has been welcomed by many developers and investors alike.

What is Tornado Cash?

Tornado Cash is a decentralized privacy protocol operating on the Ethereum blockchain. It allows users to make anonymous transactions by obfuscating transaction details and breaking on-chain links between source and destination addresses. The protocol uses zk-SNARKs (Zero-Knowledge Succinct Non-Interactive Arguments of Knowledge) technology to guarantee privacy and anonymity.

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While Tornado Cash was initially designed for privacy protection, it was also exploited for illicit purposes, including money laundering activities allegedly linked to North Korean hacker groups such as Lazarus. In 2022, the U.S. Treasury Department sanctioned Tornado Cash for providing a platform that facilitated these illegal transactions.

What is OFAC?

OFAC (Office of Foreign Assets Control) is an agency under the U.S. Department of the Treasury. Its role is to enforce economic and trade sanctions in support of U.S. national security and foreign policy objectives. OFAC targets terrorists, drug traffickers, cyber threats, and individuals involved in illicit financial activities through its sanctions programs.

In 2022, OFAC designated Tornado Cash on its sanctions list, effectively banning U.S. persons from interacting with the protocol. However, this latest update shows a degree of flexibility in regulatory approaches, as certain addresses and the website have now been delisted.

Potential Impact on the Crypto Ecosystem

The partial lifting of sanctions on Tornado Cash addresses may set a precedent for other privacy-oriented projects. However, it’s important to note that this is not a complete removal of sanctions, but rather a specific delisting of selected wallet addresses and the website. Regulatory agencies continue to evolve their approaches to cryptocurrency projects, offering both new opportunities and risks for the industry.

This development is seen as a positive step by many in the blockchain space, potentially signaling a shift toward more nuanced regulation of privacy protocols.

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