China Labels Cryptocurrencies as Espionage Accomplices

China's Ministry of State Security (MSS) has warned citizens about the risks associated with cryptocurrencies, labeling them as tools for money laundering, cyberattacks, and espionage. According to the MSS, foreign intelligence services may use cryptocurrencies to fund their activities and persuade potential agents of their supposed confidentiality.

The agency emphasized that blockchain records transaction history, making it difficult for users to remain anonymous. It also stated that exchanging cryptocurrencies for fiat money and interacting with payment services can link addresses to real identities, rendering the idea of complete untraceability an 'illusion.'

China has maintained a hardline stance on cryptocurrencies, having banned ICOs and shut down crypto exchanges in 2017. In February, the People's Bank of China and seven other state agencies confirmed restrictions on the cryptocurrency sector, extending them to operations with real-world asset tokenization (RWA).