Hong Kong Launches CryptoTrace Against Web3 Crimes

Hong Kong police have launched a new tool to strengthen cybercrime prevention in the city's fast-growing Web3 sector by tracking illicit crypto activity.

The Cyber Security and Technology Crime Bureau (CSTCB) presented CryptoTrace on Wednesday during the Blockchain Security Summit 2025.

The University of Hong Kong collaborated with authorities to create CryptoTrace, which supports a broader mission to counter the rise of cryptocurrency-related criminal activity. The tool uses advanced blockchain analysis and visualisation technologies, along with graphical mapping capabilities, to help investigators track laundered assets and speed up investigations into virtual asset-related scams, while identifying suspicious locations.

The CSTCB says the system provides "advanced intelligence and investigative support" to law enforcement officers specialising in digital asset crime. Frontline officers received training in March 2025 to improve their investigative skills in the crypto field during the tool's implementation phase.

The CSTCB not only supports law enforcement, but also aims to improve the Web3 space in terms of security and resilience. The bureau revealed that it actively collaborates with key players in the Web3 industry to ensure sustainable development and user security, although it did not disclose specific details about the partnerships.

The University of Hong Kong explained how CryptoTrace's unique design improves the tracking of suspicious transactions and fund flows, allowing law enforcement agencies to respond more quickly and effectively to crypto threats.

The launch coincides with a rise in cryptocurrency-related crimes both in Hong Kong and across the region. The police arrested 27 people in October 2024 for their involvement in a sophisticated artificial intelligence sentiment scam that extorted over USD 46 million in cryptocurrencies from victims across Asia. According to the investigation, the group tricked victims using deepfake video calls and a fraudulent crypto trading platform.

Cryptocurrency-based sentiment scams pose a growing threat globally. Research by Professor John Griffin of the University of Texas estimated $75 billion in losses caused by scams between January 2020 and February 2024, with many operations linked to Southeast Asia.

Hong Kong law enforcement agencies are strengthening defences against cybercrime as they support the city's transformation into a strategic hub for digital assets and Web3 innovation. The introduction of CryptoTrace is a key development in protecting the virtual asset space regionally.