A financial monitoring tool launched by Chinese Internet conglomerate Tencent helped China authority screen 39 enterprises suspected of illegal activities of cryptocurrency.

Through AI analysis of government data, open information, reporting information, social media, “Lingkun”, the monitoring tool found a large number of aircoins and crypto Ponzi schemes in Shenzhen, the tech city of China,  while many branches of overseas cryptocurrency institutions in Shenzhen is relatively compliant businesses.

As Bitcoin and crypto mining are not illegal in China, so how to define the compliance boundary is a sticky business in the current situation where China’s ambition of cracking down on illegal activities involving cryptocurrency has reinvigorated.

Tencent has the largest instant messenger WeChat and QQ in China, and WeChat has a monthly user flow of more than 1.1 billion. At present, the vast majority of cryptocurrency activities in China are carried out on social media like WeChat and QQ, but people now turn to software with better encryption such as telegram.

“Lingkun” has made full use of Tencent’s security capabilities covering almost all Chinese citizens, and nearly 20 years of QQ black industry attacking experience. Tencent’s “Lingkun” has successfully overcome the regulatory problem of “data, algorithm and Computing power” shortage powered by its AI advantages and the world’s first-class big data team.

In the 2018 WeChat open class, Tencent released a WeChat  data report about the frequently used emoticon, sleep time and video calling habits of users. Some netizens questioned that whether WeChat monitors the private data. Tencent responded that all data has been anonymized and desensitized, not involving the privacy of specific users.

On November 22, China’s technology capital Shenzhen issued a warning against illegal activities involving cryptocurrency and has launched an investigation into local enterprises following Shanghai’s move to investigate local cryptocurrency marketplace.

The monitoring tool of Tencent can also identify the risk index of more than ten financial categories such as P2P, financing, foreign exchange through the government affairs data from more than 40 administrative units in Shenzhen to give early warning to the relevant government departments.

The traditional supervision mode can’t meet the requirements of “scientific prevention, early identification, early warning, early discovery and early disposal” for crypto activities. To strengthen functional supervision, introducing Internet technology is unavoidable.