Authorities aim to curb cross-border crypto crime through new tech collaboration with academia.
Hong Kong is stepping up its efforts to combat digital financial crime by developing a cryptocurrency transaction tracking tool in partnership with the University of Hong Kong, the region’s Customs and Excise Department announced Thursday.
The initiative comes in response to a notable rise in crypto-linked money laundering cases, with officials citing the “transnational and borderless” nature of illicit activities involving digital assets.
“These money laundering threats are characterized by a transnational and borderless nature, and no single agency can tackle this problem alone,” said Assistant Commissioner Mario Wong Ho-yin during a media briefing, as reported by the South China Morning Post.
Although details of the tool’s operation remain classified, the announcement underscores Hong Kong’s commitment to tightening oversight of digital finance, especially as it evolves into a major hub for crypto innovation and regulation.
Crypto-Linked Money Laundering Cases on the Rise
From 2021 to May 2025, Hong Kong Customs handled 39 major money laundering cases, seven of which involved cryptocurrencies. Most of these were trade-based laundering schemes designed to disguise illegal funds as legitimate business transactions.
Key Case Highlights:
- One investigation uncovered over 1,000 suspicious transactions worth approximately HK$1.8 billion (~$229 million).
- Funds moved through five shell companies and 18 local bank accounts.
- Three individuals were arrested; two are accused of funneling over HK$760 million (~$97 million) through a crypto platform.
Regional Cooperation and Global Context
To support cross-border enforcement, the department and the university hosted a three-day international workshop with officials from eight jurisdictions, including China, India, Iran, New Zealand, Thailand, and Singapore. The goal: bolster regional partnerships and intelligence sharing to combat crypto-fueled financial crime.
This move also comes amid heightened global scrutiny. Just recently, Iurii Gugnin, founder of Evita Pay, was arrested in New York and charged with laundering over $530 million through crypto on behalf of sanctioned Russian banks. According to the U.S. Department of Justice, Gugnin used stablecoin transactions to bypass sanctions and move restricted funds into the American financial system.
The Bigger Picture: Crypto Crime and Compliance
The Hong Kong initiative aligns with a growing global trend where governments and regulators are investing in crypto surveillance technologies to stay ahead of increasingly sophisticated laundering tactics. It also signals a shift toward public-private partnerships in designing tools for forensic blockchain analysis, which could soon become standard across APAC regulatory agencies.