On October 2, 2026, prominent on-chain investigator ZachXBT raised serious allegations against UPay, a cryptocurrency payment and card-issuing platform. The researcher claims that UPay may be facilitating white-label Visa crypto card services for Xinbi, a marketplace recently targeted by international regulators. ZachXBT has publicly called upon UPay CEO Owen Yang to clarify the operational relationship between the two entities, though no formal response has been issued by the company at the time of publication.
Sanctions and Regulatory Background
The controversy centers on the legal status of Xinbi, which was recently targeted by global law enforcement. On September 9, 2026, the U.S. Treasury Department's Office of Foreign Assets Control (OFAC) officially designated Xinbi as a significant transnational criminal organization. This designation resulted in the immediate freezing of over US$10 million in cryptocurrency assets tied to the platform. OFAC sanctions typically prohibit financial institutions and service providers from conducting business with designated entities to prevent money laundering and illicit financing.
Implications of White-Label Allegations
The investigation suggests that UPay’s infrastructure might be powering the financial products offered by the sanctioned group. If the allegations of white-labeling are verified, it would imply that UPay provided the underlying technology and banking relationships necessary for Xinbi to issue branded Visa debit cards to its users.
Key concerns highlighted by the investigation include:
- Identification of shared technical infrastructure between the two platforms.
- Potential bypass of Know Your Customer (KYC) and Anti-Money Laundering (AML) protocols.
- Risks posed to the integrity of the broader blockchain payment ecosystem.
White-labeling in the crypto industry allows companies to offer branded financial services without building the backend compliance and banking infrastructure from scratch.
The situation remains developing as the industry awaits a statement from Owen Yang. The allegations underscore the increasing scrutiny faced by crypto card issuers and payment gateways regarding their third-party partnerships. As regulators continue to monitor the intersection of digital assets and traditional finance, the outcome of this inquiry could have significant implications for compliance standards within the Web3 payment sector.
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For educational purposes only. Nothing here constitutes financial or investment advice. Crypto markets are highly volatile — always DYOR before making any decisions.
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