Using a mixer as a sign of guilt — China floats a new rule for crypto cases

An opinion article in the newspaper of China's top prosecutors' office has proposed that courts assume a person intended to launder money if they used a coin mixer or a privacy coin, unless that person can offer reasonable evidence to the contrary. The piece carries no legal force, but it offers a window into how China's prosecution system is starting to think about crypto crime.

First, the plain terms. A coin mixer is a service that pools together coins from many people and pays out different coins of the same value, which breaks the trail that a public blockchain would otherwise leave behind. A privacy coin, such as Monero, is built from the ground up to hide the sender, the receiver, and the amount. Both tools have honest uses, like ordinary financial privacy, and dishonest ones, like hiding stolen funds.

The proposal, written by two district prosecutors and a law professor and published in the theory section of the Procuratorate Daily, would let courts presume criminal intent when a suspect uses these obscuring tools, dumps large amounts of crypto at obviously unreasonable prices, or pushes high-frequency transfers through anonymous wallets. It would also treat on-chain records that anyone can check on a block explorer as presumptively genuine, and count reports from blockchain analytics firms as expert evidence. Separately, it calls for a national platform to hold and sell seized coins, since China bans trading and authorities currently have no clean way to cash them out.

For context, China outlawed crypto trading and mining in 2021, yet it remains one of the busiest fronts for crypto money laundering. Prosecutors charged more than 3,000 people with crypto-related laundering in 2024 alone, and Chainalysis estimates that Chinese-language networks now handle roughly a fifth of all crypto laundering worldwide.

What makes this notable is that it reverses the usual burden of proof, asking the suspect to explain away a privacy tool rather than asking the state to prove intent. It is a proposal, not a law, and nothing here is legal advice. But it is a reminder that privacy technology, legal in much of the world, is increasingly treated as a red flag by investigators, and that beginners should understand how a tool is viewed where they live before they reach for it.