China Sells Seized Bitcoin Through Private Firms, Dodging Crypto Ban

Local governments in China are turning to private companies to sell confiscated cryptocurrencies, bypassing the country’s ban on digital asset trading. This practice arises amid a legislative void that lacks clear guidelines for managing seized crypto assets, leading to non-transparent and risky approaches.

According to Reuters, local authorities sold up to 15,000 Bitcoin, valued at approximately $1.4 billion, by the end of 2023. Overall, China is estimated to hold 194,000 BTC, ranking it second globally in government-held Bitcoin reserves, after the United States.

This situation creates a dilemma: while the country maintains its ban on crypto transactions, it simultaneously uses these assets to support public finances. More experts are suggesting that China’s central bank should take control and either establish a national Bitcoin reserve or a sovereign crypto fund based in Hong Kong, where crypto trading is legal.

This move highlights the urgent need for clear regulations as cryptocurrencies become increasingly important tools in global economic and political dynamics.