Huione Guarantee, an online marketplace initially designed for legitimate escrow services, has morphed into a sprawling ecosystem allegedly facilitating large-scale money laundering, primarily for online scams. Elliptic researchers estimate that a staggering $24 billion has flowed through the platform, a significant increase from the $11 billion identified just a year prior. This surge in volume is attributed to the platform’s expansion into a quasi-financial ecosystem including an in-house communication service called “ChatMe,” a cryptocurrency exchange (Huione Crypto), and a US dollar-backed stablecoin known as “USDH.” The platform’s self-proclaimed regulatory freedom, touted on the USDH website, allows it to circumvent the restrictions commonly applied to other cryptocurrencies, making it an attractive avenue for illicit activities. While these additions appear to be a strategic move towards self-sufficiency, the core business remains the provision of escrow and transfer services that mask the laundering of illicit funds.
The central issue with Huione Guarantee, according to Elliptic researchers, lies in the blatant advertising of money laundering services by vendors operating on the platform. These vendors openly solicit clients involved in various types of online fraud, using Huione Guarantee as a conduit for cleaning their illicit proceeds. This points to a deliberate facilitation of criminal activity, transforming the platform from a legitimate escrow service into a key enabler of online scams. Despite the platform’s growth and expansion, its core function appears to be firmly rooted in the laundering of criminal proceeds, raising serious concerns about its true purpose and impact.
As its involvement in illicit activities comes under increasing scrutiny, Huione Group, the platform’s owner, has attempted to distance itself from Huione Guarantee. Rebranding the marketplace as “Haowang Guarantee” and downplaying its connection to other associated services like Huione Pay are strategic maneuvers aimed at obscuring the group’s association with the alleged money laundering hub. However, Huione Group has acknowledged a continued “strategic partnership” with the rebranded marketplace, confirming its ongoing involvement despite the attempted distancing. This rebranding effort highlights the group’s awareness of the platform’s illicit activities and its desire to protect its reputation from the ensuing fallout.
Despite the rebranding and attempts at distancing, Huione Guarantee’s operations continue to flourish, particularly within its Telegram groups. Boasting over 139,000 users, these groups serve as a crucial channel for moving large sums of cryptocurrency at discounted rates, solidifying the platform’s position as a key facilitator of illicit financial transactions. The significant user base, particularly in contrast to declining numbers on competing platforms facing government crackdowns, suggests that Huione Guarantee has successfully carved out a niche in the underground economy. This reliance on Telegram, however, presents both an opportunity and a potential vulnerability for disrupting the platform’s operations.
Further investigation by Elliptic has uncovered a Telegram bot allegedly linked to Huione Guarantee, through which an estimated $6 billion has been funneled, primarily for online gambling. The rudimentary nature of the “games” offered through the bot, coupled with the consistent betting patterns observed among users, suggests a sophisticated money laundering operation disguised as online gambling. The lack of skill involved, the similar wager amounts, and the precise intervals between bets all point to automated activity designed to obscure the flow of illicit funds. This alleged gambling operation serves as another layer in Huione Guarantee’s ecosystem, further solidifying its role in facilitating illicit financial activities.
While Huione Guarantee aims for self-sufficiency through its integrated services, its continued reliance on external platforms like Tether and Telegram presents a vulnerability. Despite promoting its own stablecoin and exchange, these have yet to achieve significant transaction volumes, forcing the platform to remain reliant on established third-party infrastructure. This dependence presents a potential avenue for intervention. By targeting these service providers, authorities could disrupt Huione Guarantee’s operations and potentially dismantle its vast network of illicit activities. This window of opportunity, however, may be closing as the platform strives to achieve complete self-sufficiency, further complicating future intervention efforts.
