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China passes law criminalizing fundraising in digital assets

China has passed a new policy that will make fundraising with cryptocurrencies and other forms of digital assets illegal in the country.

The new policy, initiated by the Chinese Supreme Court, aims to reduce the risk of circulation and use of digital currencies. It also wants to prevent the absorption of funds from the public using digital currencies.

Cryptocurrency fundraising is now illegal

This also means that any form of fundraising that involves participants contributing using cryptocurrencies will be considered illegal in the country.

China has always expressed its distaste for cryptocurrency trading and mining in the country. Several laws have already been passed to prevent trading involving digital assets.

The latest development is another step towards making any activity that involves the exchange of digital assets in the country unfeasible.

The law will come into effect from March 1

This will be the first time that China’s Supreme Court will add digital assets in the judicial interpretation of illegal fundraising. The law aims to punish any behavior of absorbing funds through virtual currency.

This is a review of the judicial interpretation of the law, which maintains four of its original features. The review also improved sentencing and punishment for illegal fundraising crimes. Other sections covered include finance leasing, digital currency transactions, online lending, and crime. The new law will take effect on March 1, 2021.

China is known for enforcing strict cryptocurrency policies. Over the past decade, the country has announced more than a dozen bans on cryptocurrency-related activities. However, the crypto community felt the brunt of the law in 2021, when the government took the biggest crackdown on the sector.

The country’s top regulators have jointly issued a total ban on cryptocurrency trading and mining, forcing many digital asset companies to relocate to other, friendlier regions.

The new directive declared all types of cryptocurrency-related activities illegal and prohibited cryptocurrency exchanges from providing these services. Therefore, the recent regulatory update on cryptocurrency fundraising may not be too surprising for many people.

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About the author

Archu

I am CBC, I am a Crypto expert and a part-time blogger. I usually write about how and where to buy crypto coins in legit ways.

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