JusticeNet: Establishing a Multi-Jurisdictional Criminal Proceeds Virtual Currency Disposal Pathway, Exploring the "Liquidation, Destruction, Return" Three Disposal Measures

On December 14, the Justice Network of the *People's Procuratorate Daily* (Supreme People's Procuratorate of China) published an article titled *Establishing a Multi-Faceted Judicial Disposal Path for Criminal Virtual Currency Cases*, outlining three core measures: liquidation, destruction, and restitution. The author is a first-level researcher and Party Committee member of the Third Division of the Beijing People's Procuratorate, who also serves as a professor and doctoral supervisor at Capital University of Economics and Business’s Law School and a research assistant at its Anti-Corruption and Rule of Law Research Center. Key points from the article include: First, clarify third-party institutions’ legal status and role. Under current laws, third-party entities lack explicit authorization to participate in criminal asset disposal. Future legislation could designate them as judicial auction assistants via a special criminal asset disposal procedure, granting exclusive "one-time, targeted, non-public bidding" qualifications. This defines their auxiliary role and limits their scope, reducing rent-seeking and market abuse risks. Second, establish dual technical and procedural standards. The Supreme People’s Court and Supreme People’s Procuratorate, in conjunction with financial regulators, could jointly release unified standards: - **Technical**: Specify auction platform requirements (blockchain capabilities, data security safeguards). - **Procedural**: Standardize pricing (use 20-day pre-transaction average or victims’ purchase cost to avoid subjectivity), create a standardized on-chain evidence format for traceability, and require liquidation proceeds to go directly to a designated treasury account (no third-party intermediaries) to cut off speculative fund recycling. Third, strengthen full-process procuratorial supervision and rights protection. Procuratorial organs could oversee disposal dynamically: requiring third parties to submit regular progress reports (on-chain tracking, bidding records, fund transfer receipts) and establishing notification/objection channels for case parties and bona fide third parties. Objections would trigger expert reviews or independent institutional assessments to ensure fairness. Fourth, explore differentiated disposal models (guided by proportionality): - **Victim restitution**: Prioritize targeted auction liquidation (e.g., stablecoins victims haven’t redeemed post-fraud; direct original-coin return may apply to avoid exchange losses). - **Confiscated prohibited items**: Use destruction or technical sequestration (e.g., Ponzi/gambling tokens with low liquidity/shallow market depth; destruction records included in judgments). - **Commingled funds**: Prioritize liquidation for high-value coins with mixed criminal/legitimate funds to maximize loss recovery. - **Simplified cases**: Streamline procedures for small-value cases or those with tracking challenges (e.g., identify value/ownership via evidence if circulation paths can’t be fully traced). Procuratorial organs could hold pre-prosecution hearings to gather input from victims, defense counsel, and financial regulators, weighing currency type, market value, victim needs, and financial stability to select the method that minimizes harm, least disrupts order, and most effectively combats crime.