Be Cautious of Becoming the New Leek in Web3 Stablecoin Concept Schemes!
Author: Lawyer Deng Xiaoyu, Mankun Blockchain Legal Services
Cover: Photo by Tingey Injury Law Firm on Unsplash
Recently, the US "GENIUS Act" was passed
Hong Kong's "Stablecoin Regulation Draft" was passed in the third reading
Subsequently, major institutions began interpreting the impact of future stablecoin issuance on the Web3 world, with an overwhelming number of discussions on this topic.
For a moment, this year's hot RWA concept was overshadowed.
However, many friends have reported to Mankun Lawyers that some media, social platforms, and communities are indeed reappearing with illegal fundraising activities and propaganda using "financial innovation" as a gimmick, with the aim of attracting funds and using the concepts of "stablecoin", "RWA coin", "JD coin" and other variants as a pretext. The main forms include but are not limited to conducting training, project introductions, financing transactions, and various online and offline activities.
As a law firm with the mission of "ensuring Web3.0 occurs legally in China", Mankun Lawyers must step forward at this time to provide relevant warnings to domestic Web3 practitioners and newcomers!
[The translation continues in the same manner for the rest of the text]Funding schemes typically promote their so-called "investment opportunities" through media, recommendation meetings, WeChat groups, video channels, and other means. Just remember one sentence: "Public exposure does not equal legality". Never assume that "since this project is openly advertised, it must be legitimate". Public exposure is merely a necessary path for funding schemes to acquire customers.
3. Enticement:
Funding schemes use high returns as bait, promising extraordinary returns such as "doubling in six months" or "long-term potential for thousand-fold gains". These returns are often far higher than normal investment channels, exploiting investors' greedy psychology to attract participation. A common funding scheme rhetoric is: "This stablecoin is about to be listed in Hong Kong, if you pre-purchase, it will definitely yield thousands or tens of thousands of times in returns." Think about it, if it's called a stablecoin, how could you believe its returns could multiply by thousands or tens of thousands?
4. Social Aspect:
Stable funding schemes absorb funds from unspecified targets, meaning they are open to the public. They do not strictly review investors' qualifications, and anyone can participate. Generally, all regulated and compliant projects will provide risk warnings to investors (such as securities account opening) and assess investment capabilities (like domestic securities accounts for trading Hong Kong or US stocks), whereas funding schemes leveraging stablecoin concepts will not set any such thresholds.
Retail investors entering Web3 can briefly assess whether a project is a funding scheme from these four dimensions.
Once a project meets these conditions, it is definitely an illegal fundraising activity in mainland China and will likely face criminal prosecution.
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