Recent decisions by the Shanghai people's court focused on the termination of an illegal stablecoin network involved in transactions amounting to 6.5 billion yuan, highlighting China's actions against unauthorized cryptocurrency operations.
Key Operators of the Network
Individuals named Yang and Xu were identified as the main operators of this network. Yang handled customer recruitment and fund allocation abroad, while Xu managed domestic accounts through 17 shell companies.
Operational Mechanism and Workarounds
This network allowed individuals in China to bypass currency controls using stablecoins for cross-border funds. Gao Yongfeng, Senior Partner at Shanghai Jinli Law Firm emphasized, "this illegal exchange mechanism splits what should be a single, regulated forex transaction into two separate operations, thereby evading regulatory oversight."
Market Impact and Regulations
Despite the actions against this network, the broader crypto market remained stable, with no significant shifts reported. Stronger regulatory measures are anticipated from China to manage cryptocurrency flows.
The closure of this stablecoin network underscores China's active efforts to regulate cryptocurrency operations. Existing regulatory trends suggest the market requires close attention and action from authorities.
