China’s authorities warn against using USDT

On December 27, the Supreme People’s Procuratorate of China issued a notification in which it deemed the use of USDT from Tether illegal in cross-border currency operations.

“The entity uses virtual currency as a means to profit from exchange-rate differences by providing cross-border exchange and payment services. It exploits the special properties of virtual currency to circumvent national currency supervision and to facilitate the exchange of foreign currency and yuan through a ‘foreign currency — virtual currency — yuan’ arrangement,” the statement said.

The agency mentioned several cases in which individuals used USDT in “illicit business operations,” and urged local branches to adopt stricter measures regarding cases involving the use of stablecoins.

At the end of 2022, Chinese police, during a large operation, arrested 63 people in a case involving the laundering of 12 billion yuan using USDT. Previously, the Chaoyang District Court (Beijing) deemed illegal payments in Tether’s stablecoin.

Back in 2021, Fan Yifei, deputy governor of the People’s Bank of China, described bitcoin and speculative instruments, threatening the safety of the financial system and social stability.