China security ministry says crypto anonymity is an illusion

China’s Ministry of State Security said via its official WeChat account that cryptocurrency anonymity is effectively an illusion and that transactions can be traced when digital assets are used for illegal crimes. The ministry said blockchain transaction records are public and difficult to tamper with, allowing authorities to track on-chain fund flows, while device information, IP addresses and other traces remain during fiat currency conversion. It added that in February, Chinese authorities reaffirmed their existing position that BTC, ETH and USDT cannot circulate as currencies in China and that related financial activities are illegal.