The China Internet Finance Association and six other associations jointly issued a Risk Alert on Preventing Illegal Activities related to Virtual Currency and Other.

BlockBeats News, December 5th. Seven associations including the China Internet Finance Association jointly issued a risk reminder on preventing illegal activities related to virtual currency. According to the reminder, virtual currency cannot be used as a currency for circulation within China, and China's financial regulatory authorities have not approved any real-world asset tokenization activities.

Relevant institutions are prohibited from engaging in business related to virtual currency and real-world asset tokens. The general public should be highly vigilant and refrain from participating in activities related to virtual currency and real-world asset tokens, as well as illegal fundraising and securities issuance activities conducted under the guise of virtual currency "mining," safeguarding their own "wallets." The China Internet Finance Association, China Banking Association, China Securities Association, China Securities Investment Fund Association, China Futures Association, China Association of Listed Companies, and China Payment and Clearing Association jointly issued the following risk reminders:

I. Correctly Understand the Essential Nature of Virtual Currency, Real-World Asset Tokens, and Related Activities

Virtual currency is not issued by the monetary authority, is not a legal tender, does not have the same legal status as legal tender, and cannot be used as a currency for circulation within China. Among them, air coins like Π Coin lack substantive technological innovation, clear business application scenarios, and value, have opaque issuance and operation mechanisms, serious fraud and market manipulation issues, and often involve pyramid schemes and fraud activities conducted under their name. Stablecoins currently cannot effectively meet requirements such as customer identification and anti-money laundering, posing risks of being used for money laundering, fundraising fraud, and illegal cross-border fund transfers. Real-world asset tokenization involves financing and trading activities through the issuance of tokens (utility tokens) or other equity or debt instruments with token (utility token) characteristics. It carries multiple risks, including false asset risks, business failure risks, and speculative trading risks. Currently, China's financial regulatory authorities have not approved any real-world asset tokenization activities.

Domestic institutions and individuals engaging in domestic activities such as legal currency-to-virtual currency exchanges, real-world asset token issuance and financing are suspected of illegally issuing token vouchers, illegal fundraising, unauthorized public issuance of securities, and illegal operation of futures business activities. Foreign virtual currency and real-world asset token service providers directly or indirectly engaging in various forms of business activities related to China within China are also engaged in illegal financial activities. The domestic personnel of such foreign virtual currency service providers, as well as domestic institutions and individuals who knowingly or should know that they are engaged in virtual currency-related business but still provide services to them, will be held accountable by law.

II. Relevant Institutions Are Prohibited from Engaging in Business Related to Virtual Currency and Real-World Asset Tokens

Member units are not allowed to participate in domestic virtual currency issuance and trading activities, and must not directly or indirectly provide related services for customers to issue and trade virtual currency or real-world asset tokens domestically. Banking and payment institution member units are not allowed to provide services for domestic issuance and trading of virtual currency and real-world asset token-related activities, and must not provide any form of financial services or credit support to virtual currency "mining" enterprises and projects. Strict customer due diligence must be conducted, the involvement in virtual currency and real-world asset token transactions or money laundering risks must be promptly assessed, ensuring that business development complies with regulatory requirements, and any suspicious clues discovered must be reported to relevant authorities in accordance with procedures. Securities, fund, and futures institution member units are not allowed to provide services for the issuance and trading of virtual currency, real-world asset tokens, and related financial products within China. Internet platform enterprise member units are not allowed to provide any form of marketing or information technology services for domestic issuance and trading of virtual currency, real-world asset tokens related business activities, and must effectively carry out compliance checks on platform information releases. Member units should conduct comprehensive virtual currency and real-world asset token risk reminders and warning education to remind the general public to discern risks and stay away from illegal activities.

3. The general public should be highly vigilant of various forms of virtual currency and real-world asset token business activities

The price of virtual currency is highly volatile and is often used for speculative trading and pyramid schemes among other illegal activities. The general public is advised to significantly enhance their risk awareness and identification capabilities, safeguard their own "wallet," refrain from participating in virtual currency and real-world asset token-related activities, as well as illegal fundraising and securities issuance activities conducted under the guise of virtual currency "mining." Stay away from virtual currency and real-world asset tokens to avoid involvement in related illegal criminal activities. Be wary of joining communities promoting virtual currency and real-world asset token business activities, and alert to false advertising containing historical returns, buying and selling advice, or speculative prospects related to virtual currency and real-world asset tokens. Refrain from clicking on links and QR codes containing overseas virtual currency and real-world asset token trading platforms or access channels. If any clues related to virtual currency and real-world asset token business activities are discovered, promptly report them to the relevant regulatory authorities. In cases involving suspected illegal activities, report them promptly to the public security organs.