China’s Capital Outflow via Crypto in 2019 Amounted to $11.4 Billion
The outflow of capital from China through cryptocurrency trading in 2019 amounted to $11.4 billion, writes 8btc, citing a study by a local company PeckShield.
In a report on money laundering through digital assets, the PeckShield team reviews the status of “illegal or unregulated” transactions using cryptocurrencies. Analysts have calculated the amount of capital outflows through cryptocurrencies over the past three years: in 2018, it amounted to $17.9 billion, and in 2017 — $10.1 billion. Its total volume exceeds 1% of China’s $3 trillion foreign currency reserve. In comparison, China’s total outbound direct investment in 2018 amounted to $143 billion.
According to the report, losses from security breaches on cryptocurrency exchanges are growing from year to year. In 2017, 11 major incidents were recorded, resulting in a loss of $294 million; in 2018, 46 incidents and $4.758 billion; in 2019, 63 incidents and $7.679 billion.
According to analysts, 330,000 BTC were put into a dark web in 2018 and 540,000 BTC in 2019 or $2.1 billion and $3.9 billion, respectively. Some of them subsequently ended up on exchanges where they were laundered or exchanged for other currencies, including fiat ones. PeckShield claims that 29,471.64 BTC was transferred from dark web to major exchanges in 2019, which at the time of the exchange rate was $216 million.
Earlier, the official television channel of the Communist Party of China called cryptocurrencies an example of financial fraud.
Author: Marko Vidrih
Featured image credit: Pixabay