Changjiang Currency Exchange, a money transmitter business based in Australia, has been involved in a major money laundering scandal, resulting in the arrest of seven individuals after a 14-month investigation. The operation, carried out by 300 police officers across multiple Australian cities, led to the apprehension of four Chinese citizens and three Australian nationals. The business, which was operating under the guise of a legitimate currency exchange, is said to have facilitated the laundering of dirty funds and tainted cryptocurrency from investment scams and unregistered crypto exchanges. One Chinese national alone is accused of using the services of Changjiang Currency Exchange to launder AU$100 million ($63 million) from a multinational Ponzi scheme.
The investigation was sparked by the discovery of irregular traffic at Changjiang kiosks throughout Australia during a time of strict COVID-19 lockdowns. As part of the investigation, the Australian Federal Police have seized AU$21 million ($13.27 million) in cash and various luxury items believed to have been purchased using the proceeds of crime. The investigation is still ongoing.
In other news, Bitget, a crypto derivatives exchange, has experienced significant growth in the third quarter of this year, becoming the fourth-largest exchange by volume, following behind Binance, OKX, and Bybit. According to a transparency report released by Bitget, the exchange’s market share has risen to 9.43% compared to its negligible volume just two years ago. During the third quarter, Bitget onboarded over 9,000 traders and 85,000 followers or copy-traders, resulting in a net trading profit of $6.7 million. However, the overall trading activity in the industry fell by 23% year-over-year to $4.8 trillion in the same period. Bitget’s user protection fund reached a peak of $368 million and now stands at $350 million. The exchange claims to have no debt and a proof-of-reserves ratio exceeding 200%. In September, the company launched the $100 million EmpowerX Fund for ecosystem development and expanded its workforce with the hiring of 60 staff members for its Middle East expansion plans.
China has also shown signs of softening its stance on blockchain-related activities. Xianyu, Alibaba’s peer-to-peer marketplace, has lifted its censorship of “nonfungible tokens” (NFTs) related keywords in its search tool and relisted Topnod NFT collectibles minted on Alibaba’s Ant Blockchain. Previously, due to regulatory uncertainty, Topnod digital collectibles were prohibited from listing on secondary markets. The Chinese government has also announced plans to launch an official NFT trading platform, although it is still under development. The move comes after China implemented strict regulations on crypto-related activities, except for outright ownership of cryptocurrencies.
Blockchain technology is being utilized in various sectors in China, with one recent application being in the health insurance industry. Residents of Shanghai, Zhejiang, Jiangsu, and Anhui provinces can now submit and validate their health insurance claims using blockchain technology. In collaboration with Ant Insurance, users in these regions are able to submit their claims online, and after blockchain verification, receive reimbursement within hours. The use of blockchain technology has improved efficiency and transparency in the claims process, preventing moral hazard and providing real convenience to the users.
Lastly, the Jianpu People’s Court in Huaian, China, is implementing AI recognition, big data, and blockchain technology to enhance law enforcement surveillance. The court has created an all-purpose system that monitors visitors entering and leaving court premises. If a visitor is identified as trespassing in an unauthorized area, the system will alert court bailiffs for immediate apprehension. This system aims to reduce the need for patrolling hard-to-monitor areas and improve overall security. Through the system, court bailiffs have access to detailed information on all visitors’ movements within the court premises. Augmented reality is also being used to enhance visibility in hard-to-see areas for better resolution.
These developments in East Asia showcase the evolving landscape of the region’s blockchain industry. While there are still regulatory challenges and occasional scandals, there is also progress being made in leveraging blockchain technology for various sectors, such as finance, healthcare, and law enforcement.