China’s government has banned foreign currency from its economy for the first time since 2007, following a wave of currency counterfeiting that hit the country in 2016.
But despite the ban, black market currency, especially in the form of counterfeit gold coins, has remained an international phenomenon.
In a recent report by the International Monetary Fund (IMF), China’s central bank warned that some coins were likely to become “a new source of revenue for criminal gangs and organized crime groups.”
But experts and the U.S. Treasury Department agree that the Chinese government is not entirely out of the woods.
“We’re still waiting for the Chinese central bank to put some kind of regulations in place on the black markets,” said John Taylor, a senior research fellow at the Peterson Institute for International Economics (PIIE).
“But if it doesn’t do that, then you could see the black-market economy growing again.”
“We are seeing a lot of demand for these counterfeit coins, especially with Chinese authorities trying to crack down on money laundering and other illicit activity,” said James O’Connor, a professor at the University of Michigan and the co-author of a book on the phenomenon, “The Secret History of the Black Market.” But the U