China flags virtual currency laundering risk as 2025 AML law takes effect

Authorities are preparing the next five-year financial security framework with tougher anti-money laundering enforcement, closer scrutiny of virtual currency-linked crime and broader cross-border cooperation.

Summary

China is stepping up its anti-money laundering drive as authorities prepare the country’s financial security framework for the next five-year policy cycle, with a sharper focus on crime tied to virtual currencies and stronger international coordination. The People’s Bank of China has outlined plans to reinforce AML enforcement, expand scrutiny of virtual currency-related illicit activity and deepen cross-border cooperation. The push builds on the revised Anti-Money Laundering Law that took effect in 2025 and follows earlier warnings from PBOC Vice Governor Xuan Changneng that cross-border laundering through virtual currencies and underground banks remains a major risk. Xuan said more than 2,000 cases under Criminal Law Article 191 were adjudicated nationwide in 2025, and that the central bank aims to normalize enforcement while tracking illicit fund transfers using new technologies and business models.

Terms & Concepts
  • Anti-Money Laundering Law: Rules aimed at detecting and preventing the movement of illicit funds through the financial system
  • virtual currencies: Digital assets that can be transferred or traded and may be used in illicit fund flows
  • underground banks: Unlicensed money-transfer networks that operate outside the formal financial system