A court in Beijing, China, has sentenced five people to prison for using the stablecoin USDT to secretly transfer money across borders, disguising the activity as cryptocurrency trading to get around China’s foreign exchange controls.
According to local reports, the case is one of 13 representative financial crime rulings released by the Beijing Municipal People’s Procuratorate for 2024–2025. The list covers several major areas, including banking, insurance, securities, credit, and foreign exchange management.
The case details released at the 2025 Financial Street Forum, the group operated from January to August 2023. They used personal bank cards to receive large sums of renminbi (RMB) from domestic clients who wanted to move money abroad. The funds were then converted into USDT on multiple crypto trading platforms and sent to wallets abroad, turning the stablecoin into an informal settlement channel.
How the scheme worked
Investigators said two of the defendants, both surnamed Lin, organized the scheme, while the others, surnamed Xia, Bao, and Chen, handled transactions and account coordination. The scheme generated more than 1.18 billion yuan (approximately USD 166 million). Each member was involved in at least 149 million yuan worth of transactions.
They turned RMB into USDT and sent it abroad on behalf of clients, effectively running an unlicensed cross-border transfer service. The group earned money from the gap between domestic RMB prices and offshore USDT rates.
Verdict and investigation method
The Haidian District People’s Court ruled that the group was effectively running an underground foreign exchange service and convicted them of “illegal business operations.” They were sentenced to between two and four years in prison and fined. All five pleaded guilty and did not appeal.
As the money chain passed through overseas crypto exchanges, prosecutors had to rely on a more technical investigation. Digital forensics teams helped verify the data pulled from the trading platforms. They then recreated the full path of the transfers, from receiving the money in Chinese bank accounts to converting it into USDT and moving it offshore.
This end-to-end tracking allowed authorities to verify the scale of the scheme and hand out accurate sentences. Authorities state that the case will be used as a benchmark for future cases, given that financial crimes increasingly include cryptocurrencies and foreign platforms.
Also Read: Indian Trader Duped of ₹2.05 Cr in Fake USDT Investment Plan
