Why did the official who understands blockchain best fall from grace due to virtual currency power and money transactions

The former Director of the Technology Supervision Department of the China Securities Regulatory Commission and Director of the Digital Currency Research Institute, Yao Qian, has been investigated for using his position to facilitate virtual currency rights and money transactions. According to CCTV, in 2018, Yao Qian made contact with a trading platform to assist businessman Zhang in obtaining an online listing opportunity for an ICO project, receiving 2000 ETH as compensation. This is the first time the Chinese authorities have publicly disclosed a case of officials using virtual currencies to commit corruption, involving funds totaling over 386 million yuan. CCTV will broadcast a special program titled “Technology Empowers Anti-Corruption” at 8 PM tonight, revealing case details.

Core Facts of the Case

The specific process of rights and money transactions

According to CCTV reports, the basic situation of the case is:

• Time: 2018
• Event: Yao Qian was entrusted by businessman Zhang to make contact with a trading platform to help the ICO project get listed
• Compensation: After the ICO raised 20,000 ETH, Zhang transferred 2000 ETH to Yao Qian as thanks
• Seizure: The case team found a hardware wallet in Yao Qian’s office drawer

The concealment of fund flows

In addition to direct virtual currency transactions, the case also involved complex money laundering processes:

• 10 million yuan funds in virtual currency trader accounts
• Transferred through approximately four layers of penetration
• Ultimately used to purchase a villa in Beijing
• The total involved funds amount to over 386 million yuan

Irony of Identity Contradiction

From supporter to lawbreaker

Yao Qian’s unique identity makes this case particularly noteworthy:

• He is a pioneer in China’s digital currency field, leading the Digital RMB project
• He is an official within the system who strongly supports cryptocurrencies and blockchain
• Not long before being investigated, he published an article on Caixin, calling for China to learn from the US in open cryptocurrency regulation
• But he ultimately fell due to using virtual currencies for rights and money transactions

This creates a stark contrast: the official who understands blockchain technology and supports virtual currency development most, yet becomes the first official publicly reported for virtual currency corruption.

The dual nature of virtual currencies

This case reveals a core contradiction of virtual currencies:

Virtual currencies are designed to circumvent traditional financial regulation, possessing strong concealment and anonymity features. But precisely because of these characteristics, they also become tools for rights and money transactions. A staff member of the Central Commission for Discipline Inspection stated, “When virtual currencies turn into real assets, they become much easier to expose”—meaning the anonymity of virtual currencies cannot ultimately withstand modern anti-corruption technology.

Technological Insights for Anti-Corruption

According to CCTV reports, the breakthrough in this case relied on:

• In-depth ideological and political work by the Discipline Inspection and Supervision Team stationed at the CSRC
• Timely acquisition of key physical evidence such as virtual currency hardware wallets
• Strict extraction of virtual currency transaction records following electronic evidence collection requirements
• Proper valuation of virtual currency prices

This indicates that, with advances in anti-corruption technology, although virtual currencies have technical concealment, they are not invulnerable in the face of judicial evidence collection at the national level. Hardware wallets, transaction records, and price evaluations can all serve as evidence.

Summary

The significance of this case lies in three aspects:

First, it breaks the myth that virtual currencies “cannot be traced.” Although virtual currencies have anonymity, once they involve conversion into real assets (such as purchasing property), traceable traces will remain.

Second, it shows that even officials who are most knowledgeable about technology and most supportive of innovation cannot escape legal sanctions. Identity and power do not serve as shields against illegal activities.

Third, this is the first time the Chinese authorities have publicly disclosed a case of virtual currency rights and money transactions, marking a new stage in regulatory attention to virtual currency risks. In the future, regulation and tracing of virtual currency transactions may become an important part of anti-corruption efforts.