Is Shi Yongxin a hidden pro in the crypto world? The abbot of the Shaolin Temple in China is involved in Bitcoin Money Laundering.

According to the WeChat public account of the Xiao Sa Law Firm, recently, the abbot of Shaolin Temple, Shi Yongxin, has been reported to be under joint investigation by multiple departments. Many people are likely aware of this news. What is surprising is that it seems to involve Bitcoin money laundering and the presence of Mining Rigs in the temple, which are operations within the crypto world. This case not only exposes individual corruption but also brings the regulatory blind spots created by the collision of religious sites and crypto assets to the forefront. This article will analyze the compliance traps associated with crypto assets from a legal perspective, helping readers understand the legal boundaries of religious sites touching on virtual assets.

1. The Crypto World Landscape of the Shaolin Business Empire: From 'Buddhist CEO' to Bitcoin Money Laundering

On July 27, when the official announcement from the Shaolin Temple came out, the criminal accusation against Shi Yongxin for "misappropriation and occupation of temple assets" quickly hit the trending searches. As the investigation deepened, an even more astonishing detail was revealed: this abbot, known as the "CEO of Buddhism," actually devised a method centered around Crypto Assets for cross-border capital flow.

Combining information from multiple sources, the operations of the Shih Yongxin team in the crypto world are a typical case of money laundering. From 2016 to 2024, the "International Propagation Special Account" of the Shaolin Temple transferred nearly a million every month to an overseas company in the British Virgin Islands, totaling 130 million. After these funds were laundered through an underground money house in Hong Kong, part of it was exchanged for Bitcoin, ultimately landing in overseas properties in London and New York. It is said that investigators found a USB drive at his residence containing the keys to 18 Ethereum accounts, corresponding to assets exceeding 100 million USD; and a string of prayer beads engraved with mnemonic phrases surprisingly became the key to moving the "digital wallet." This method of hiding money is indeed quite discreet.

In terms of business layout, Shi Yongxin's actions in the crypto world are consistent with the "Shaolin IP Empire" he has built. By 2023, Shaolin Temple had registered nearly 800 trademarks, covering 45 categories from convenience foods to jewelry, with trademark licensing fees exceeding 100 million yuan in just one year. When traditional business territory encounters bottlenecks, the advantages of encryption, such as anonymity and ease of cross-border movement, naturally make it an ideal tool for him to transfer assets. However, this "double-edged sword" ultimately pushed him to the opposite side of the law.

2. The Three Major Offenses That Shi Yongxin May Have Violated: Legal Red Lines of Crypto Assets

In this case, crypto assets are not just a payment tool, but a key element throughout the entire process of fund misappropriation, cross-border transfer, and asset concealment. Combined with Chinese law, his operations may violate three charges, each of which is closely related to the characteristics of virtual currency.

Money Laundering Crime (Article 191 of the Criminal Law): From the investigation, it appears that 80 million yuan in government subsidies was transferred to a Singapore account under the guise of "Southeast Asia Dharma Base Construction" and was converted to Bitcoin in less than 72 hours. After being passed through the dark web, it flowed back under the name of "mineral procurement funds." This operation of "converting RMB to crypto assets and then using fake businesses to conceal the real purpose" fully meets the criteria for the crime of money laundering, which includes "concealing and disguising the sources and nature of the proceeds of drug crimes, corruption, bribery, etc." Additionally, it is worth noting the use of mixers (CoinJoin). The Shih Yongxin team used this tool to mix multiple funds together, cutting off the on-chain tracking path, making it difficult to trace the source of the funds. The tool itself is not illegal, but once used to conceal criminal proceeds, it becomes an "accomplice" to money laundering. According to the Notice on Further Preventing and Handling Risks of Speculation in Virtual Currency Transactions ("9.24 Notice"), virtual currency-related activities are considered illegal financial activities, and providing exchange and trading services for them may be suspected of violating the law.

Embezzlement (Article 271 of the Criminal Law): As a place of religious activity, the property of Shaolin Temple is classified as public property or property jointly owned by believers according to Article 52 of the Religious Affairs Ordinance. However, Shi Yongxin, through controlling Henan Shaolin Intangible Asset Management Co., Ltd., converted temple funds into Bitcoin and transferred them to a private wallet. The amount involved far exceeds the standard of "particularly huge amount," and he may face more than ten years of fixed-term imprisonment, or even life imprisonment.

Money Laundering (Criminal Law Article 190): Shi Yongxin also used offshore companies to convert funds into Crypto Assets, thereby circumventing foreign exchange controls to flow abroad, with a cumulative amount of several hundred million yuan. It is important to know that individuals can exchange a maximum of 50,000 US dollars in foreign exchange each year. His method of gradually transferring funds abroad in a "ant moving house" manner, even disguised as religious exchanges, cannot hide the illegal nature.

3. Regulatory Dilemmas: When Incense Money Meets Bitcoin

The case of Shi Yongxin reveals not only individual corruption but also the regulatory blind spots that emerge from the collision between religious venues and crypto assets. The formation of this situation reflects several deeper issues:

Managing the faith money bag is difficult: According to the "Religious Affairs Ordinance", the property of places of religious activities belongs to that place or the affiliated religious organization. However, in practice, the donation money in the merit box and the "electronic merit" from QR code payments may turn into the private money of the abbot. Shi Yongxin created an "Shaolin Cloud" APP, allowing believers to convert their donations directly into USDT, turning over more than 200 million a year, yet no formal financial records were left behind. This kind of "digital incense" bypasses traditional auditing, making it difficult for even tax authorities to trace its whereabouts.

Blockchain as a Criminal Ledger: The immutable nature of blockchain was initially a technical advantage, but it has now become a ledger for recording crimes. Investigators managed to reconstruct the complete path of funds flowing from the Shaolin Temple to overseas real estate by analyzing the on-chain data of 18 Ethereum wallets. However, methods like mixers and dark web transactions still consumed a significant amount of judicial resources for fund tracking, highlighting the stark reality of technology outpacing regulation.

Religious signs become tax evasion shields: Religious places should be far from the smell of money, yet they are used as tools for profit. China implements a religious policy of "protecting the legal and stopping the illegal"; when religious activities are tied to commercial behavior, how to define compliance boundaries becomes a dilemma. The Shiyongxin team disguised mining rigs as "religious cultural equipment" for import, taking advantage of the tax incentives for importing religious goods. This kind of borderline operation exposes the lack of inter-departmental regulatory cooperation.

However, the chaos in religion is not a first-time occurrence. Events such as the "Unification Church" black money scandal in Japan and the "Golf Lady" incident in Thailand, where monks embezzled tens of millions of Thai baht, remind us that when faith is tainted with the smell of money, sacred places may become lawless territories. The current case of Shi Yongxin further reflects the urgency of cryptocurrency regulation in the religious domain. Just as the China Buddhist Association demonstrated when revoking Shi Yongxin's戒牒, religious places must adhere to precepts and respect the law; of course, this warning also applies to the realm of virtual currencies.

IV. Learning from Cases: Legal Red Lines for Crypto Assets Compliance

The Shih Yongxin case has sounded the alarm for everyone involved in or looking to enter the crypto assets space. Whether religious institutions or ordinary investors, it is essential to remember not to cross the legal red line:

Do not use virtual currency to transfer illegal funds: Whether it is embezzled property or funds to evade foreign exchange controls, transferring through encryption across countries may constitute Money Laundering. Regulatory authorities' on-chain tracking technology has been continuously upgrading, and even if mixing services are used, it is not absolutely untraceable, so do not hold a mentality of luck.

Virtual currency mining remains a regulated forbidden zone: China's overall attitude towards virtual currency mining is still one of resolute regulation. The operation of Mining Rigs hidden inside Shaolin Temple violates the "Notice on Rectifying Virtual Currency 'Mining' Activities" issued by the National Development and Reform Commission and eight other departments in 2021, and the relevant equipment will be legally sealed.

Offshore structures cannot become a paradise for evasion: Building financial channels through BVI companies, Swiss banks, and crypto exchanges like Shih Yongxin has now become a key target of international anti-money laundering cooperation. In June 2025, the FATF plenary meeting amended the standard recommendation 16 (referred to as the "travel rule" when it involves virtual assets), and the new rules make payment message information more standardized, with clearer identities of both parties involved in the fund transfer. The space for offshore tax evasion is becoming increasingly limited.

NFT and similar forms are still subject to legal constraints: The Shih Yongxin team once attempted to issue "Digital Prayer Bead NFT," trying to tokenize religious IP, but according to Chinese regulations, NFTs cannot be used as financing tools. Transactions must comply with the principles of "physical anchoring and value stability." Any illegal fundraising or money laundering activities under the name of NFTs will face legal accountability.

Conclusion:

The uniqueness of the Shih Yongxin case lies in its combination of "faith" and "code," two seemingly unrelated elements. What we see is not just personal degeneration, but also the confusion of traditional organizations in the wave of technology. Crypto assets themselves are not a flood or a beast, but their anonymity and cross-border nature require a stricter compliance framework for regulation. For religious places, returning to the essence of "contentment and simplicity" and distancing themselves from capital games is essential to rebuild credibility; for all market entities, when integrating into the new wave of technology, it must be remembered that no matter how powerful the code is, it cannot cross the legal red line. Just like what Master Bodhidharma realized after sitting facing the wall for nine years: "Seeing the nature of the mind clearly points directly to the human heart." In the maze of virtual currencies, only by adhering to the original intention of law and morality can one progress steadily and far. Ultimately, whether in the crypto world or reality, compliance is always the most reliable amulet.