China Issues Warning Regarding Unauthorized Fundraising Schemes Disguised as Crypto and Yuanverse Investments

In a collaborative push to address illicit financial movements, Chinese regulatory bodies, along with the Dalian Supervision Bureau, have issued a significant alert regarding the rise of deceptive fundraising practices. virtual currency “, “Yuanverse” and “wealth sharing.”

The recent advisory notes that investigations have revealed a concerning pattern in which wrongdoers exploit these attractive phrases to create fraudulent schemes that pose major risks to investors and weaken the stability of the economy and financial systems.

These dubious operations have predominantly surfaced on the internet, through platforms like WeChat groups, as well as offline through seminars held across the nation. During these events, unsuspecting individuals are tricked into downloading illicit apps and acquiring virtual currencies under the guise of 'sharing wealth and business opportunities.' illegal  Such activities are suspected of involving illegal fundraising, fraud, and other criminal offenses, which jeopardize personal property and disrupt the smooth operation of economic and financial frameworks.

In response to these alarming scams, authorities have emphasized several crucial points. They recalled that in September 2017, a joint statement from seven government agencies, including the People’s Bank of China, categorically banned all token issuance financing methods, labeling them as unauthorized financial activities tied to illegal token sales and fundraising infractions.

In a similar vein, in May 2021, major industry organizations—like the China Internet Finance Association, the China Banking Association, and the China Payment and Clearing Association—united to warn about the lack of legal protection for contracts related to virtual currency transactions. Thus, parties engaging in these transactions are fully liable for any resulting consequences and financial losses. financial fraud , and pyramid schemes.

Authorities Define Legal Guidelines for Virtual Currency Transactions

Following previous regulatory steps, a detailed notice was released in September 2021 by ten government departments, including the People’s Bank of China and the Supreme People’s Court. This document outlined the legal boundaries surrounding virtual currency dealings, confirming the illegality of token issuance financing, cryptocurrency exchanges, and associated derivatives trading. Additionally, it reiterated that civil legal claims arising from investments in virtual currencies that violate public order and customs are deemed invalid, leading to further complications.

As stated in Article 25 of the Regulations on Preventing and Addressing Illegal Fundraising, individuals involved in such schemes bear sole responsibility for any financial losses they encounter. With these regulatory measures in force, the public is encouraged to be cautious, raise awareness about risks, and adopt prudent investment practices. People should avoid speculative trading of 'virtual currencies,' unlawful fundraising, and any other illicit financial customs to protect their assets. losses  borne by the involved parties.

This alert calls for increased vigilance and reinforces our shared commitment to countering illegal fundraising actions, thus safeguarding the integrity of the financial system and the interests of investors. As regulatory bodies heighten their efforts to ensure financial stability, individuals are urged to stay informed and alert, supporting the development of a more secure and transparent economic environment.

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