How did the sickle of “Second Uncle” cut your head?

With the explosion of the online video “Three days back to the village, the second uncle cured my mental internal friction” , a virtual currency called second uncle coin (ie second uncle coin) has also quietly entered the stage of history. It was rumored that the “Second Uncle Coin” had collected about 1.3 million US dollars within 3 days of its issuance, and the project party was suspected of running away with the money. As a result, the topic of “Er Jiu Coin Crash” directly hit the hot search on July 31.

Although the “Second Uncle Coin” is not issued in China, we can still briefly analyze the legal risks in the “Second Uncle Coin” incident in the Chinese context . It should be noted that neither Sister Sa herself nor the members of Sister Sa’s team are aware of any inside information about Erjiucoin, and they are definitely not “insiders”. Like the public, we can only learn about it through public channels reported by relevant media. And evaluate the second uncle coins.

An overview of the event

According to the information reported by the media, the initiator of Erjiu Coin established the second uncle DAO through the aforementioned popular online videos (hot events), and issued Erjiu Coin and absorbed funds as the main body. The project party claimed that the funds raised would be donated to the “Second Uncle” to provide him with old-age security. Although the gimmick sounds good, recently, some netizens have reported that the Erjiu Coin Pool is suspected of having a Rug pull (a proper term in the crypto-asset circle, referring to the project party running away with money), and the project party has successfully laundered money through Tornado Cash. , successfully swept away about $1.3 million in funds.

Although second uncle DAO then questioned the netizen’s statement and clarified that “the team did not rugpull”, some netizens pointed out that the news released by the netizen itself was not reliable. However, the hot search for “Er Jiu Coin Crash” still resurfaced in a very short period of time, causing heated discussions. At present, according to relevant website inquiries, the value of Erjiu coin is only one-tenth of the highest price.

2. “Second Uncle Coin” and Second Uncle: Risk of Civil Tort

Although “Er Jiu Coin” is very popular and may even attract the majority of netizens to imitate it, it should be noted that there are still many risks in the operation of “Er Jiu Coin”. For the project side of “Er Jiu Coin”, The first thing it faces is the risk of civil tort .

Although the project of “Second Uncle Coin” does not specify the object referred to by the so-called “Second Uncle”, and its official name is also described by a non-specific name such as “second uncle”, no matter whether it is the pictures used by the project party , or the copywriting used by the project party, all precisely narrowed the word “Second Uncle” to the protagonist of the aforementioned online video. But at present, it seems that the project party has not reached any agreement related to the project with the second uncle himself , so according to the provisions of China’s “Civil Code” and “Copyright Law”, the project party actually violated the second uncle’s own portrait right, and the copyright of the author of the photo (who took it) .

Specifically, according to Article 1019 of my country’s “Civil Code”, without the consent of the person with the right to portrait, the portrait of the person with the right to be liked shall not be produced, used, or published, unless otherwise stipulated by law. The project party’s use of the portrait of the second uncle for commercial promotion is obviously without the consent of the second uncle , and it is an act of using the portrait of the second uncle without authorization. The behavior constitutes a violation of the second uncle’s portrait right. In addition, according to the provisions of Article 26 of the “Copyright Law”, the use of other people’s works shall be subject to a licensing contract with the copyright owner, except where this law may not require permission. The project party uses the work of the author of the photo without entering into a contract with the author or obtaining the author’s authorization, and its use does not constitute fair use in the sense of copyright law. Therefore, this behavior also constitutes an infringement of the copyright of the photo author. behavior .

To sum up, for the project party of “Second Uncle Coin”, its unauthorized use of another person’s portrait as its own avatar not only infringes the portrait right of the second uncle, but also infringes the copyright of the relevant right holder, and should bear the corresponding responsibility. of civil tort liability.

3. Issuing coins for donations: criminal legal risks

In addition to the above-mentioned civil legal risks, if the above information is true, then the coin issuance and fund-raising behavior of the project party of Erjiu Coin should actually be regarded as an ICO behavior, which is an administrative violation in China . Specifically, it violated the “Announcement on Preventing Token Issuance and Financing Risks” (hereinafter referred to as “94 Announcement”) issued by seven ministries and commissions including the central bank in September 2017. According to the “94 Announcement”, the so-called ICO refers to “financing entities raise bitcoin, Ethereum and other so-called ‘virtual currencies’ from investors through the illegal sale and circulation of tokens, which is essentially a kind of illegal public financing without approval. It is suspected of illegally selling tokens, tickets, financial fraud, pyramid schemes and criminal activities .”

Although the project party claims that the purpose of issuing the “Second Uncle Coin” is to provide security for the second uncle’s pension, it does not mean that the parties can do evil things with it for a good purpose. method does not yield positive results. The act of issuing “Er Jiu Coin” actually complies with the aforementioned regulations on ICO, and can be evaluated as an ICO act. According to the “94 Announcement”, the central bank and other ministries have characterized ICOs as “unapproved and illegal public financing.” Therefore, conducting ICOs directly violates the “94 Announcement” and is an administrative violation.

On this basis, it is worth noting that if the project party promises external profits in the process of issuing “Second Uncle Coins”, or treats “Second Uncle Coins” as financial products such as stocks and securities, etc., then This behavior is very likely to be evaluated as illegal fundraising, which may constitute the crime of unauthorized establishment of financial institutions in Article 174 of the Criminal Law, the crime of illegally attracting public deposits in Article 176, and the unauthorized issuance of stocks, companies, and corporate bonds in Article 179. Therefore, the project party has a greater criminal legal risk .

Even if the project party did not carry out the aforementioned acts in the operation process, if the rumors are true, then the project party of Erjiu Coin is suspected of constituting the crime of fraud stipulated in Article 266 of the Criminal Law of China , or Article 192 of the Criminal Law of the People’s Republic of China. The specified crime of fundraising fraud . Specifically, the project party’s running away or money laundering behavior can reflect its subjective purpose of illegal possession . In addition, it claims that it is raising funds for donations, but it actually uses the funds for other purposes. , which obviously belongs to defrauding investors’ funds through fraudulent means. In this case, as long as the amount reaches the “large amount” standard required by the crime of fraud, the project party is suspected of committing the crime of fraud.

In addition, if the behavior of the project party is also illegally absorbing public deposits, it directly constitutes the crime of fundraising fraud on the basis of the purpose of illegal possession. If the amount of fraud is calculated at 1.3 million US dollars, it is a huge amount and should be punished for seven years . imprisonment or life imprisonment .

      At the same time, it should be noted that although “Er Jiu Coin” is issued abroad, it is undeniable that many Chinese users have participated in it. Therefore, once the behavior of the project party constitutes a crime, according to Article 8 of my country’s “Criminal Law” related to the protection of jurisdiction It is stipulated that even in foreign countries, as long as it is a crime against our citizens (and the statutory sentence is more than three years in prison), our country still has jurisdiction. If the project personnel themselves are Chinese citizens, then according to the personal jurisdiction of Article 7 of the “Criminal Law”, China still has criminal jurisdiction over them and can be punished by China’s criminal law.

write at the end

In fact, the issuance of rubbish hot events like “Er Jiu Coin” has been common as early as 2017, and it is still prevalent on major overseas platforms. It is a common and frequent crime in the virtual asset circle. In effect, this is a financial scam of old wine in a new bottle. Since the Ponzi scheme in 1919, financial fraud has appeared all over the world in various forms, and administrative regulators and judicial institutions have never stopped fighting against financial fraud. It can only be said that the use of social hot events to establish DAO currency issuance and other scams Fraud methods that use new technologies and new concepts, but the essence of their behavior is still in the category prohibited by laws (especially criminal law) and administrative regulations .

For the investors involved, the biggest risk is: (1) Unable to obtain investment income; (2) Unable to recover the investment principal. In addition, in this kind of scam, the victims are often not ordinary novice investors, but people with certain experience in investing in encrypted assets, who enter the game with a certain speculative mentality and are deceived. In this regard, Sister Sa’s team believes that the best anti-fraud technique is to not participate in the game. If you must enter the game, investors must conduct a more detailed background investigation on the project party before investing, and try to choose a reputable project party. Do not invest blindly.

For administrative regulatory agencies and judicial agencies, this requires us to strengthen prior supervision and education, and strengthen social publicity and education to prevent financial fraud. At the same time, when dealing with financial crimes, the judiciary must take facts as the basis, take the law as the criterion, and adhere to the unity of fairness, justice and efficiency.

Posted by:CoinYuppie,Reprinted with attribution to:
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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