US Crackdown Targets Xinbi Marketplace, Prompting Rival Launderers to Exit

U.S. law enforcement intensified its action against the Xinbi Guarantee marketplace, seizing communication channels, wallets and sanctioning service providers that support the platform’s illicit finance operations.

Seizures and Sanctions

A federal court authorized the seizure of Xinbi‑related Telegram channels on September 7. Investigators also seized two wallets holding roughly $12 million and sought restraint of 47 additional addresses tied to vendors and suspected money‑laundering activity. The Treasury Department designated Xinbi a significant transnational criminal organization and sanctioned SafeW Technology and Anwen Technology, companies that provide messaging and payment infrastructure for the marketplace.

Infrastructure Targeted

Xinbi had begun moving merchant coordination to the encrypted SafeW application in mid‑2025 and introduced the XinbiPay (NewPay) service as scrutiny increased. By sanctioning these providers alongside wallet seizures, authorities aimed at both the flow of funds and the tools used to organize transactions.

Scale of Illicit Activity

Chainalysis reports that Xinbi processed an estimated $24 billion in digital assets and fiat since its emergence in 2022, serving Southeast Asian scam operators, cyber‑theft actors and other illicit services. The platform facilitated the conversion of stolen crypto into stablecoins, cash delivery, bank‑card fraud, personal‑data sales and other underground services.

On‑Chain Impact

Analytics firm Bitrace observed a sharp rise in USDT outflows from a Xinbi sub‑guarantee platform after the enforcement actions. Daily withdrawals jumped from $389 k–$564 k (Sept 1‑7) to $1.28 million on Sept 8 and $1.81 million on Sept 9, with an additional $708 k leaving by Sept 10. The outflows reflect merchants moving funds to avoid future freezes.

Ripple Effect on Competitors

Competing marketplace Fulilai Guarantee began removing money‑laundering merchants from public groups following the Xinbi sanctions. Its Fulilai Wallet recorded about $9.3 million in outflows since the Office of Foreign Assets Control (OFAC) announcement.

Future Outlook

The crackdown demonstrates a shift toward targeting service providers and infrastructure rather than individual tokens. While platforms may consider alternative stablecoins to evade issuer freezes, sanctions on messaging, payment and wallet services pose broader operational risks for illicit finance networks.