Involvement of China’s Ministry of Public Security ensures compliance.
Wenzhou Court has legally liquidated seized digital assets, including over 6,000 USDT, 2,700+ TRX, and 0.8 BNB, marking a new precedent in China’s legal system.
This landmark case highlights China’s evolving legal framework for handling digital asset crime, potentially influencing future regulatory practices and exchange operations in the cryptocurrency sector.
The Wenzhou Court’s liquidation of virtual assets stolen in December 2022 represents a significant judicial first in China. Key figures included the defendant Liu, who used a counterfeit digital wallet, and Wang Zitai, who coordinated the asset disposal by engaging the Third Research Institute of the Ministry of Public Security. The court worked under Article 23 guidelines, ensuring transparency in the liquidation process.
Asset conversion through a licensed exchange to clear funds to about 50,000 RMB exemplifies a new procedural standard. This sets a notable precedent for judicial responses to cybercrime, delineating a transparent path for asset handling in criminal cases.
The financial and government sectors have largely supported this legal process. Cryptocurrency markets, while minimally affected by the volumes liquidated, noted the move as a procedural anchor for future cases. There have been no significant public reactions from key figures in the cryptocurrency community.
Did you know? This liquidation marks the first time the Chinese judicial system applied Article 23 of the Supreme Court amendments to handle digital assets, providing a new standard for future cases.
According to CoinMarketCap, Tether USDt (USDT) maintains a price of $1.00 with a market cap of $164.53 billion as of August 9, 2025. With a trading volume of $106.35 billion and stable price movements within the past 90 days, USDT shows resilience in market performance.
Coincu’s research team assesses that this regulated liquidation method can increase confidence in digital asset transactions under judicial review, potentially fostering a standardized approach that balances market dynamics while enhancing legal safeguards. This move could further drive international dialogues on the integration of digital assets into global financial systems.
