Hong Kong Report: Bitcoin and Cryptocurrency Have Little Impact on Organized Crime
The Hong Kong Financial Services and Treasury (FSTB) released a 132-page report entitled “Money Laundering and Terrorist Financing Risk Assessment.” According to the report, cryptocurrencies have little impact on organized crime.
Between 2013 and 2017, there were 167 Bitcoin-related reports to the HKPF (Hong Kong Police Force). Most of the reports involved blackmail using ransomware (such as the recent “WannaCry” attack), and the figure is comparatively low compared with that in other jurisdictions. Investigations and intelligence do not suggest VCs (Virtual Currencies) were used or intended to be used in other prevalent predicate offences (e.g. drugs, dutiable goods smuggling) or TF (Terrorist Financing). The threat level is low.
Hong Kong is well known for its lack of capital controls and for capturing capital outflow from China. The report notes that cryptocurrencies may be more attractive in economies where people are trying to circumvent currency controls or beat high inflation rates.
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