Hong Kong Unveils New Crypto-Forensics Tool in HKU Collaboration

Hong Kong’s Customs and Excise Department has quietly commissioned the University of Hong Kong to help build an advanced system for tracing blockchain transactions—part of a broader push to clamp down on digital-asset money laundering.

“Financial crime today crosses every border,” said Mario Wong Ho-yin, Assistant Commissioner for Intelligence and Investigation. “No single authority can tackle it alone”—a point he made at a June 12 press briefing about the initiative scmp.com.

Why the Urgency?

Between January 2021 and May 2025, Hong Kong authorities logged 39 major money-laundering probes, seven of which involved cryptocurrencies and more than HK$9 billion (≈ US$1.1 billion) in suspect transfers scmp.com. Many schemes hid illicit proceeds behind routine trade transactions before funnelling funds through digital-asset platforms.

One case alone featured over 1,000 flagged transactions totaling HK$1.8 billion. That investigation led to three arrests—two suspects are accused of routing HK$760 million via a single token exchange.

A Tech-Driven Defense

The new tool—details of which remain classified—will fuse on-chain analytics with machine-learning pattern detection to spot abnormal transaction paths in real time. By partnering with HKU’s data-science experts, Customs aims to leapfrog manual forensics and flag laundering attempts the moment they cross its radar.

Simultaneously, officials just wrapped a multi-day workshop bringing together law-enforcement and consular representatives from eight jurisdictions (including China, India, Iran, New Zealand, Singapore and Thailand) to forge tighter, cross-border cooperation on crypto crime.

Global Echoes: U.S. Charges Crypto Exec in $530M Laundering Ring

Hong Kong’s crypto-clamping efforts mirror high-profile actions by U.S. authorities. In New York last week, the Department of Justice unsealed a 22-count indictment against Iurii Gugnin, founder of Evita Pay, accusing him of laundering over US$500 million for sanctioned Russian banks justice.gov.

“Gugnin converted a crypto company into a covert pipeline for dirty money,” said John A. Eisenberg, Assistant Attorney General for National Security. “This Office will aggressively pursue those who undermine our financial system” justice.gov.

That case underscores how quickly digital-asset platforms can be misused to evade sanctions—reinforcing the need for automated tracing tools like the one underway in Hong Kong.

What Comes Next

• Pilot Testing
  A closed pilot of the tracing tool will run later this summer, evaluating its ability to sift millions of on-chain transactions for money-laundering red flags.
• Broader Roll-Out
  Subject to pilot success, Customs plans to integrate the system into its standard investigations by early 2026.
• Regional Sharing
  Insights and software modules will be shared with partner agencies across Asia, strengthening a regional anti-laundering network.

As digital currencies become ever more entwined with global commerce, Hong Kong’s blend of academic research and enforcement could set a new standard for safeguarding the integrity of cross-border finance.

Written by Press News Security Desk
Sources:

• South China Morning Post: SCMP report on HK Customs–HKU tracing tool scmp.com
• U.S. Department of Justice press release on Iurii Gugnin indictment justice.gov

This article is for informational purposes and does not constitute legal or investment advice.