Asia Express – Cointelegraph Magazine

Crypto fraud gets personal in China as ‘send it to this wallet’ becomes ‘give it to this guy’

In a scam that combined a fake relationship, fake crypto, and real doorbells, a woman in Xuzhou, a city in eastern China’s Jiangsu Province, lost over $55,000 to a man who pitched USDT investments and sent a cash collector to her home. Five suspects have been arrested and the investigation is ongoing.

According to a notice published via the official WeChat account of the local police, the victim was first contacted by a man claiming to be an active-duty soldier. He gained her trust by invoking military rules that supposedly prohibited the use of WeChat, and directed her to download a separate app for private communication.

As their conversations grew more frequent and familiar, the man shared a fabricated story about a friend who had joined the state-run Tobacco bureau after retiring from the military and had access to internal data. He claimed they had already earned substantial profits through investments and invited her to get in on the action.

He then sent her a fake version of a “China Tobacco” investment platform and told her the site only accepted deposits in USDT stablecoin, commonly referred to as “U Coin” in China. When the victim expressed uncertainty about how to convert her money into crypto, the man offered to connect her with a local exchanger who could visit her home and complete the transaction.

Over the course of three in-person cash handovers, the victim gave away more than 400,000 yuan without receiving any cryptocurrency in return.

Authorities described this hybrid scam — blending online grooming with in-person cash pickups — as a growing trend in crypto-related fraud in mainland China.

In December, state mouthpiece People’s Daily reported police in southwestern China’s Sichuan Province busted a money laundering operation that also began with a scammer posing as a former soldier who built emotional trust online and pitched a bogus investment opportunity. 

But instead of having her funds picked up at the door, the victim in the Sichuan case was reportedly coerced into delivering it herself. After withdrawing 200,000 yuan (around $27,000) under the scammer’s direction, she handed the cash to five masked men at a roadside location. The fraud led investigators to a laundering scheme involving 12 suspects and nearly 10 million yuan ($1.36 million) in stolen funds.

Bitcoin miner on the outside, illegal arcade on the inside

South Korean police have reportedly uncovered an unregistered arcade that was disguised as a cryptocurrency mining facility.

The case flips a familiar script. In most crypto-related busts, mining operations disguise themselves as other businesses to hide electricity use or skirt regulation. But here, it was a crypto mining facade used as camouflage.

The local police said that they had booked a man on suspicion of violating the Game Industry Promotion Act. He is accused of operating a covert, illegal gaming business inside an office space dressed up to look like a crypto mining center. In South Korea, arcades that convert game points into cash — particularly those operating without a license or under a false business front — are illegal. 

According to investigators, the entrepreneur had rebranded arcade machines to resemble cryptocurrency mining rigs and registered visitors as “members.” New players were asked to set up personal crypto wallets — though it’s believed no actual cryptocurrency was involved. Instead, the use of wallets and crypto terminology appears to have been part of an effort to legitimize the operation and blur its true purpose.

The games themselves were modified versions of free mobile titles, repackaged into paid arcade-style machines. When players earned points, they were told to use a so-called “coin app” which functioned as a payout interface designed to mimic a crypto transaction platform. In reality, players simply entered their bank account numbers, and the system transferred cash directly into their accounts, deducting a 10% fee. No blockchain activity has been confirmed.

Investors are using USDT to hedge against local currency depreciation

With the Korean won…