Shanghai, China announced a major case of illegal Exchange Currency amounting to 6.5 billion yuan using stablecoin as a medium.

On July 20, the People's Court of Pudong New District, Shanghai, announced a major case involving the illegal exchange of 6.5 billion yuan using stablecoins as a medium of exchange. The case revealed that individuals including Yang and Xu operated domestic shell company accounts to provide stablecoins (with USDT as the medium of exchange) for unspecified clients' overseas accounts, thereby facilitating cross-border fund transfers for profit. The suspects were involved in illegal forex trading amounting to as high as 6.5 billion yuan over the past three years. Among them, Yang was responsible for attracting clients and allocating forex funds abroad, while Xu managed the corporate accounts of 17 shell companies domestically, processing daily fund flows exceeding 10 million yuan, with clear division of labor and close cooperation. The disclosed case details indicate that at the end of 2023, a Shanghai citizen, Ms. Chen, needed to remit money to her daughter overseas. Restricted by the forex quota, she contacted an overseas "exchange company" (the aforementioned domestic shell company A controlled by Yang and others). Following instructions, Ms. Chen transferred RMB to Company A's account, after which her daughter's overseas account received the equivalent amount in forex, and the "exchange company" charged a certain percentage as a service fee. For a long time, this criminal gang has provided illegal currency exchange services abroad under the guise of "collection and payment" through cross-border "matching".