Raising Funds Via Crypto? Get 10 Years Prison, Penalty In This Country
China’s Supreme People’s Court has made fundraising using cryptocurrency illegal in the country.
The rule will come into force from March 1.
This adds to already tightened regulations targeting financial scams in the country which has gained notoriety for its crackdown on crypto over the years.
While anti-crypto efforts have been ongoing since 2017, the latest development gives Chinese courts the power to officially issue sentences to criminals.
Penalties will be determined by the value of the amount raised.
The court deems fundraising topping 100,000 yuan ($15,800) as a “large amount”.
If the amount exceeds 500,000 yuan ($79,000), it will be identified as “enormous.”
If the amount is an “extremely huge” sum of 50 million yuan, a loss of at least 25 million yuan, or includes 5,000 people, the case will be “extremely serious”.
Offenders in such cases can be jailed for over a decade.
Less serious crimes will be prosecuted with under three years of prison and RMB 20,000 ($3,160) to RMB 200,000 ($31,600) in fines.
The latest crackdown measure seeks to punish illegal fundraising crimes in accordance with the law with the view to maintaining national financial security and stability.
It falls under Beijing’s aggressive efforts to get rid of crypto in the country by throwing it under the ambit of financial scams and money laundering.
Last September, China’s central bank, the People’s Bank of China (PBoC) criminalised essentially all cryptocurrency activity–from crypto transactions to mining.
As a result, miners started migrating their operations out of the country.
Before the ban, Chinese miners had produced as much as 67% of all new Bitcoins.
The advantage now goes to the US, allowing it to leapfrog China as the largest market for bitcoin mining.
It now accounts for more than 35% of the Bitcoin hash rate or computing power.