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Defendants Slapped With Heavy Fines
The Beijing court implemented what many within the crypto community described as harsh laws after an alleged illegal transaction. The five men were accused of transferring $166 million overseas, becoming one of the largest crypto-forex cases this year. Court filings show that the defendants deployed renminbi (RMB) to purchase the stablecoins through local channels, such as digital asset exchanges.
The tokens were transferred to wallets before the cross-border exchange. Assets were converted to foreign currency before being utilized for international payments. In total, the defendants facilitated approximately 1.2 billion RMB, equivalent to about $166 million, across several transactions. A major prosecution point was that the transaction took place outside regulated banking channels.
As a result, the court ruled that it constituted disguised foreign exchange trading and violated China’s Anti-Money Laundering Law and Foreign Exchange Administration Regulations. The court sentenced the defendants to jail time and imposed fines based on their level of involvement.
The lead defendant was sentenced to four years and six months in addition to a fine of 200,000 RMB, equivalent to approximately $28,000. Two other associates involved in the transfer received three-year and nine-month sentences, with fines of 150,000 RMB ($21,000). Meanwhile, the remaining defendants were sentenced to two years and eleven months in prison, as well as a 100,000 RMB ($14,000) fine.
 
This follows a surge in cases linked to China’s cryptocurrency crackdown, with authorities citing increased allegations of money laundering. Despite several crypto users backing regulations to reduce bad actors, many analysts viewed this sentence as harsh, stressing an impact on market sentiments. According to critics on social media, the crackdown was intended to limit stablecoin influence and enforce fiat controls.
Stablecoin adoption reached new heights in the last six months, as traditional investors turned to the asset class to reduce transfer fees. Firms are now onboarding stablecoin options and exposing assets. These inflows are bullish for the wider market as investors gain key exposure. China’s crypto community has also called for yuan-based assets to rival dollar/backed options.
Source: https://zycrypto.com/china-sentences-five-over-166-million-in-illegal-usdt-currency-conversions/