Authorities in Dalian, a city in China’s Liaoning province, issued a warning to investors about fraudulent schemes posing as crypto or metaverse investment opportunities.
The notice, released by Chinese financial regulators and local police, cautions investors to be cautious of “illegal fundraising activities” that promise high returns through cryptocurrency and metaverse investments. This alert comes as China intensifies its efforts to combat crypto-related fraud following a ban on cryptocurrency trading.
Authorities in Dalian Warn Public About Cryptocurrency Scams
In a coordinated effort, authorities in Dalian, along with six other regulatory bodies, issued a joint notice to caution the public about fraudulent activities in the cryptocurrency space. These scams, orchestrated by “unscrupulous individuals,” typically operate through online platforms such as WeChat groups. They lure investors into downloading illegal apps and investing in illegitimate cryptocurrencies, posing risks of suspected illegal fundraising, fraud, and other criminal activities, as outlined by the authorities.
This public warning from Dalian’s authorities comes in the wake of several previous notices from China’s regulatory bodies, including the People’s Bank of China. These notices have emphasized the illegal nature of token issuance, financing, and trading, reflecting the ongoing efforts to combat fraudulent practices within the cryptocurrency market.
China and Hong Kong’s Stance on Cryptocurrency
In September 2021, the People’s Bank of China (PBOC), along with the Supreme People’s Court and other central authorities, issued a notice imposing a ban on all cryptocurrency trading activities within mainland China. The ban explicitly stated that services offered by overseas cryptocurrency exchanges to Chinese residents on the mainland are deemed illegal financial activities.
In contrast to mainland China’s stringent crackdown on cryptocurrency trading and mining, Hong Kong adopted a more welcoming stance toward crypto-related firms in the same period. In June 2023, Hong Kong officially launched its cryptocurrency licensing framework for virtual asset trading platforms, permitting licensed exchanges to provide retail trading services. Notably, Hong Kong has granted licenses to two platforms—HashKey and OSL—to operate within its regulatory framework.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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