China accuses US of crypto crackdown as power play, ignoring its own anti-crypto stance

China's National Computer Virus Emergency Response Center (CVERC) has published a new document accusing the United States of using cryptocurrency enforcement actions as a tool for global financial domination, continuing the agency's pattern of conspiracy theories about American motives.

The 27-page report, titled "Top Player: Analysis of Global Virtual Currency Assets Extortion under the U.S. Technological Hegemony," claims that high-profile cases like the prosecution of Binance co-founder Changpeng Zhao and the pursuit of alleged cyber-scam operator Chen Zhi were not legitimate law enforcement actions but rather strategic moves to maintain US hegemony over the global financial system.

According to CVERC, Washington's actions against cryptocurrency companies serve multiple sinister purposes: preserving the US dollar's role as the world's primary reserve currency, generating massive fines to balance the federal budget, and building a strategic reserve of virtual currencies. The report even suggests that President Donald Trump's pardon of Zhao was a calculated move to ensure Binance's future compliance with US law, thereby giving Washington more control over global crypto markets.

The conspiracy theory ignores inconvenient facts

The Chinese agency's narrative conveniently overlooks several key realities. Most notably, China itself has taken a hardline stance against cryptocurrency, declaring all crypto-related transactions illegal in 2021 and maintaining one of the world's strictest anti-crypto policies. The report fails to mention that China has extradited and arrested Chen Zhi, with death sentences issued for others associated with scam camps in Cambodia.

Furthermore, the financial impact of crypto-related fines on the US federal budget is minimal. While cases against major crypto exchanges have resulted in significant penalties, these amounts represent only a tiny fraction of the nation's multi-trillion dollar budget. The suggestion that Washington is using crypto enforcement as a major revenue stream appears to be more propaganda than economic analysis.

International law enforcement cooperation

The reality of US crypto enforcement is far more nuanced than CVERC suggests. American authorities have pursued suspected crypto criminals outside US territory using well-established international procedures, including mutual legal assistance treaties and extradition agreements. These actions follow standard law enforcement protocols rather than representing some grand scheme for financial domination.

However, the Trump administration has indeed taken steps to ease regulation on cryptocurrency companies, a policy shift that has raised concerns given the Trump family's financial interests in virtual currency ventures. This regulatory relaxation represents a departure from previous administrations' approaches but doesn't support CVERC's conspiracy narrative.

China's own crypto crackdown

While CVERC accuses the US of using crypto enforcement for geopolitical purposes, Beijing has been equally aggressive in its own anti-crypto campaign. China's ban on cryptocurrency trading and mining has been one of the most comprehensive in the world, citing concerns about financial stability, capital flight, and the use of crypto in illegal activities.

The Chinese government's position contrasts sharply with its criticism of US enforcement actions. While Washington has pursued specific criminal cases involving fraud, money laundering, and sanctions violations, China has implemented a blanket prohibition on all cryptocurrency activities.

The broader context

CVERC's report is part of a broader pattern of Chinese government agencies promoting conspiracy theories about US actions. The same organization previously claimed that the United States conducts cyberattacks on its own infrastructure to make China look bad, and has suggested that the Volt Typhoon hacking group was invented by Washington to discredit Beijing.

These narratives appear designed to deflect attention from China's own cyber activities and to portray the United States as an aggressive, hegemonic power. By framing US law enforcement actions as part of a global power play, CVERC attempts to undermine the legitimacy of international efforts to combat cryptocurrency-related crime.

The reality of crypto regulation

In practice, cryptocurrency regulation varies significantly across jurisdictions. While the US has pursued enforcement actions against major exchanges and individuals involved in criminal activities, other countries have taken different approaches. Some nations have embraced crypto innovation with light-touch regulation, while others have implemented strict controls or outright bans.

The Trump administration's creation of a strategic bitcoin reserve represents a significant policy shift, but this move appears motivated by a desire to capitalize on cryptocurrency's growing importance rather than to establish global financial dominance. The policy has been controversial, with critics arguing it could increase market volatility and create conflicts of interest.

Conclusion

CVERC's latest conspiracy theory about US crypto enforcement reflects the ongoing tensions between Washington and Beijing over technological and financial issues. While the report raises questions about the motives behind cryptocurrency regulation, its claims appear more rooted in propaganda than in factual analysis.

The reality is that both the United States and China have taken aggressive stances on cryptocurrency, albeit for different reasons. As the global crypto industry continues to evolve, the debate over regulation, enforcement, and national interests is likely to intensify, with both nations pursuing policies they believe serve their strategic objectives.