Hong Kong Customs works with HKU to develop a tool that tracks crypto transactions linked to money laundering.
Authorities reported over HK 9 billion in crypto laundering since 2021 highlighting urgent need for better tracking.
Regional workshop trains law enforcement from eight countries on detecting and fighting crypto based financial crimes.
Hong Kong Customs is developing a digital tool to trace suspicious cryptocurrency transactions. The department is working with the University of Hong Kong on the project. This initiative aims to strengthen efforts against rising virtual asset-related crimes. Officials said the tool will help trace funds across wallets and exchanges. It will also support investigations and improve evidence collection in court cases.
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Authorities have reported over HK $9 billion in laundering involving cryptocurrencies since 2021. These cases reveal how digital assets are used to hide illegal proceeds. The new system is designed to detect unusual patterns and pinpoint networks linked to illicit activity. Investigators will use it to monitor crypto transactions that escape traditional banking surveillance.
In one case, over 1,000 suspicious transactions involved HK $1.8 billion across five companies and 18 bank accounts. Three suspects were arrested. Two were tied to HK $760 million in crypto transfers. Officials said most of these schemes disguised criminal funds as standard business deals. These incidents show the urgent need for better tracking tools in financial crime enforcement.
Regional and Academic Cooperation Grows
The partnership with the University of Hong Kong builds on past collaborations in digital forensics. Customs had previously used university-developed tools to support copyright enforcement. That expertise is now being applied to financial investigations. The new crypto-focused system will scan blockchain activity and flag suspicious transfers.
Authorities stressed that the project details remain confidential. Revealing how the tool works could affect enforcement efforts. However, they confirmed it will enhance cross-agency case-building. Traditional methods that monitor banks and remittance companies are no longer effective against crypto-related laundering.
To support regional collaboration, Hong Kong Customs hosted a three-day workshop. Officials from eight countries attended, including India, Thailand, Iran, Singapore, and New Zealand. The workshop focused on crypto laundering trends and how law enforcement can respond. Training sessions explored tracking techniques and shared insights on digital evidence handling.
Global Attention on Crypto Crime Prevention
Hong Kong’s move reflects growing global concern over digital asset misuse. Luxembourg’s risk assessment listed crypto exchanges as high risk. Authorities cited large user bases and anonymous online activity. Germany recently shut down a crypto platform tied to major cyberattacks and laundering. It seized over US $38 million in assets during the investigation.
In Australia, regulators flagged crypto ATMs as a serious concern. Over 1,600 machines across the country allow cash deposits into crypto accounts. Officials warned they could be used for illegal fund transfers.
Hong Kong continues to expand training for enforcement teams. Officials plan to improve digital oversight and boost cooperation across borders.