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A research article published in the official newspaper of China's Supreme People's Procuratorate has proposed that courts presume money laundering intent when suspects use crypto mixers or privacy coins, drawing a sharp regulatory contrast with the United States.
<h2 id="what-the-proposal-says">What the proposal says</h2>
The article, written by prosecutors from the Yuhu District People's Procuratorate in Hunan Province alongside a law professor from Xiangtan University, argues that China's current legal framework has failed to keep pace with digital-asset technology. Its proposals include presuming criminal intent when suspects use coin mixers or privacy coins without providing "reasonable counter-evidence," and treating verifiable on-chain records and analytics-firm reports as admissible evidence.
The standard is not one of automatic guilt. Using privacy coins or mixers would not automatically prove criminal conduct. It could support an inference of intent only when combined with evidence of concealment or illicit fund origins. The proposals also extend to suspects who offload large amounts of crypto at "obviously unreasonable" prices or conduct high-frequency, large-scale transactions.
The publication is a legal research document, not a new law, judicial interpretation, or mandatory enforcement policy. The recommendations remain non-binding. Any enforceable change would require legislation, a formal judicial interpretation, official case-handling guidance, or another authorised policy measure.
Beyond the intent question, the authors also urge the creation of a national platform to hold and sell seized crypto, tackling a problem created by China's own ban on trading it. Because Beijing bans trading, authorities that confiscate tokens have no clean legal way to cash them out, leaving billions of dollars in limbo.
<h2 id="a-widening-gap-with-washington">A widening gap with Washington</h2>
The proposal places Beijing at odds with the direction of US policy. The US Treasury, long opposed to crypto mixers because of criminal applications, said the services also have legitimate privacy uses on public blockchains, noting that mixers may lawfully help shield personal, business, and charitable transactions from public view when paired with safeguards such as record-keeping and other compliance measures.
The 32-page US report, submitted under the GENIUS Act, also proposes new legislative tools to combat illicit finance, including a "hold law" that would give financial institutions temporary safe harbor to freeze suspicious digital assets. That measured approach stands in contrast to the Chinese prosecutors' push to treat the mere use of privacy tools as a potential marker of criminal intent.
The backdrop matters. China outlawed crypto trading and mining in 2021, but it remains one of the busiest fronts for crypto-based money laundering. Chinese police have broken up large rings, including a $1.7 billion laundering operation in 2022, while Chinese-language laundering networks processed an estimated $16 billion in 2025 and now handle roughly a fifth of all crypto money laundering worldwide, according to Chainalysis.
For now, the Procuratorate paper sets the stage for professional debate rather than immediate enforcement. Whether it advances into binding law will depend on formal sign-off from China's legislative and judicial institutions.
Sources: <a href="https://decrypt.co/373374/chinese-prosecutors-float-treating-crypto-mixer-privacy-coin-use-as-sign-of-money-laundering" rel="noopener noreferrer nofollow">Decrypt: Chinese Prosecutors Float Treating Crypto Mixer, Privacy Coin Use as Sign of Money Laundering</a> <a href="https://www.coindesk.com/policy/2026/03/09/u-s-treasury-signals-shift-on-crypto-mixers-acknowledges-legitimate-privacy-uses" rel="noopener noreferrer nofollow">CoinDesk: U.S. Treasury Signals Shift on Crypto Mixers, Acknowledges Legitimate Privacy Uses</a> <a href="https://www.cryptotimes.io/2026/07/13/china-seeks-legal-overhaul-for-crypto-money-laundering-cases/" rel="noopener noreferrer nofollow">The Crypto Times: China Seeks Legal Overhaul for Crypto Money Laundering Cases</a>

Chinese prosecutors float treating mixer use as laundering intent

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