Chinese authorities have escalated their efforts to protect investors from fraudulent cryptocurrency and metaverse schemes. In Dalian, a city in the Liaoning province, warnings were issued by officials cautioning the public about deceptive investment opportunities that claim high returns through digital currencies and metaverse projects. The alerts specifically target illegal fundraising activities, which have been on the rise.
Crackdown on Deceptive Investment Activities
Dalian’s financial regulators, along with law enforcement agencies, have identified a trend of fraudulent investment schemes. These scams often involve online platforms such as WeChat groups, where individuals are persuaded to download unauthorized apps and invest in fake digital currencies.
This warning aligns with a series of notices from national regulatory institutions, including the People’s Bank of China, emphasizing the illicit nature of cryptocurrency financing and trading operations.
China’s Ongoing Regulatory Measures
The latest advisory follows the September 2021 directive by China’s central bank and other authorities, which banned all cryptocurrency transactions and deemed overseas exchange services for Chinese residents illegal. This is part of a broader restrictive policy on cryptocurrency trading and mining within the country.
Contrasting with mainland China’s stringent measures, Hong Kong has recently established a more welcoming environment for cryptocurrency enterprises. The region enacted a licensing system in June 2023, permitting two platforms, HashKey and OSL, to offer services to a retail audience.
Since 2017, China has maintained a tough position on the crypto market, stimulating Chinese investors to seek alternative avenues, such as over-the-counter (OTC) markets, for cryptocurrency investments. The government continues to enforce strict regulations to discourage these activities and press investors to adhere to authorized financial practices.
