China Warns Virtual Assets Facilitate Espionage and Cyberattacks

China's Ministry of State Security has issued a stark warning about the potential for virtual assets to be exploited for espionage, money laundering, and cyberattacks. The ministry claims that virtual assets can act as an accomplice to espionage, with overseas anti-China forces using them to disrupt the financial order and undermine national security. The ministry also emphasized the importance of understanding the anonymity of virtual assets, stating that foreign intelligence agencies could use this feature to recruit targets. In a social media post, the ministry noted that while cryptocurrency transactions may be difficult to trace, transaction records remain on the blockchain, making it possible for authorities to monitor activity. China has maintained a hard-line regulatory stance on cryptocurrencies, banning exchange operations in 2017 and effectively imposing a blanket ban on mining in 2021.