The Intermediate People’s Court of Xilin Gol League in Inner Mongolia has sentenced five operators of the Sifang payment platform to prison. The group processed transactions totaling 2.95 billion yuan (approximately $428 million) to support an online gambling network. They channeled funds using USDT, bank cards, and multiple payment accounts during their operational period from May 24, 2022, to October 18, 2023.
The Sifang platform functioned as an unauthorized fourth-party payment service. The ring operated 32 fund-pooling platforms, rented offshore servers, and connected official banking interfaces with 105 accounts across 10 third-party payment providers to facilitate transactions for gambling websites.
Tether and OKX Data Admitted into Court
Prosecutors initially alleged that the group generated 42.85 million yuan in profits from a 1.45% transaction fee. Although the court determined lower profit amounts for individual defendants, the primary charge remained illegal business operations rather than money laundering.
The group’s cryptocurrency transaction records were fully exposed in court through on-chain tracking. Law enforcement obtained wallet address data directly from stablecoin issuer Tether, alongside detailed transaction histories provided by crypto exchange OKX. These documents established a notable precedent, demonstrating that blockchain records are now admissible as legal evidence in Chinese courts.
Court filings detailed that a wallet belonging to one operator, named Zhang, received 4.146 million USDT across 485 transactions between July 2022 and October 2023, equivalent to 26.95 million yuan. Meanwhile, a wallet owned by defendant Ma logged 152 incoming transfers totaling 719,176 USDT, which the judge ruled as illicit proceeds. Zhang, alongside co-defendants Zhu and Du, was also proven to have converted 1.905 million USDT into 12.38 million yuan in cash through 11 offline transactions.
Calls for Clearer Crypto Regulations
For these financial crimes, all five operators received custodial sentences. Zhang was sentenced to six years in prison with an 850,000 yuan fine, followed by Zhu with a five-year sentence and an 800,000 yuan fine. Ma received four and a half years with a 3 million yuan fine, while the remaining defendants were handed sentences ranging between three and six years.
This wave of crackdowns coincides with growing calls from Chinese legal scholars demanding clearer regulatory frameworks regarding crypto asset misuse. Data from China’s Supreme People’s Procuratorate reflects an upward trend, with over 1,200 individuals prosecuted for drug-related money laundering between January 2025 and May 2026. The heavy caseload is accelerating the need for specialized legal frameworks.
Police investigations appear to increasingly integrate on-chain tracking techniques with assistance from global crypto platforms to pierce through anonymity. For illicit actors relying on stablecoin privacy layers, blockchain history is gradually shifting from an escape route into evidence for prosecutors.
Reported via crypto.news.
Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
