Key takeaways:
- The police in Taiwan are looking into the cryptocurrency exchange Bitgin for possible money laundering.
- The exchange stated that its operations “are normal and user rights will not be affected” in a statement on November 13.
The police in Taiwan are looking into the cryptocurrency exchange Bitgin for possible money laundering.
The company’s chief operating officer, Yuting Zhang, was reportedly detained by Taiwanese authorities early this week on suspicion of involvement in the money laundering event known as the “Eighty-Eight Guild Hall,” according to local news reports.
Formerly, authorities accused two local businessmen, Zhemin Guo, and Chengwen Tu, of running a multibillion-dollar money laundering conspiracy by utilizing their crypto exchange accounts and foreign exchange offices to launder money received via overseas wire fraud.
Tu is also charged with cheating the nation’s tax officials by allegedly selling video game credits abroad for 300 million New Taiwan dollars ($9.28 million) in order to obtain fictitious export tax refunds.
Taiwan has no formal licensing requirements for crypto exchanges. Bitgin and other industry participants established the Virtual Asset Service Provider (VASP) Preparatory Office in September to advocate to government leaders and engage in self-regulation. Yuling Tsai, general counsel of the Taiwan VASP Association, commented on the situation as follows:
“This time, a member of the preparatory group were involved in the investigation case. The preparatory group immediately held a meeting and issued a public response. The members involved in the case also took the initiative to suspend participation in the work of the preparatory group.”
The exchange stated that its operations “are normal and user rights will not be affected” in a statement on November 13. According to Bitgin, from late 2021 to March 2022, chief operational officer Zhang worked with companies connected to the Eighty-Eight Guild Hall money laundering event. In a statement released on November 13, the exchange stated:
“Operations are normal and user rights will not be affected,”
But Bitgin claimed that after learning of the accusations of money laundering, Zhang cut off all contact with the counterparties.
“At present, Bitgin is fully cooperating with the investigating unit and actively providing all necessary assistance to ensure the smooth conduct of the investigation and hopes that the facts can be clarified as soon as possible.”
But as accusations of money laundering emerged, these ties broke. The exchange is giving the investigators its whole cooperation to guarantee a seamless prosecution and prompt fact-finding.
