Is it illegal for individuals to buy and sell virtual currency?

No matter what the purpose is, many people are dabbling in the field of virtual currency, and even hold some currencies. With the change in the form of policy, some people are starting to worry, is it illegal for me to buy and sell virtual currency?

In fact, there is a lot of research on this issue on the Internet. Some people think, didn’t I just buy some virtual currency myself, even if I changed hands, it’s my own business to make or lose money, so I can still break the law?

Whether it is illegal or not depends on the specific circumstances.

Different conditions, different results

The source of the discussion on whether it is illegal or not is basically focused on a notice jointly issued by multiple national ministries and commissions on September 15, 2021, which is the “Notice on Further Preventing and Disposing of Hype Risks in Virtual Currency Transactions”.

The notice mainly elaborates on 4 points:

First, virtual currency does not have the same legal status as fiat currency, which means that virtual currency is not actually currency and cannot be circulated as currency, but is similar to virtual goods.

 The second is that virtual currency-related business activities are illegal financial activities. This one is also the most concerned about. We will discuss it in detail later.

 Third, the provision of services by overseas virtual currency exchanges to Chinese residents through the Internet is also an illegal financial activity.

 Fourth, there are legal risks involved in virtual currency investment and trading activities.

 The second point states that virtual currency-related business activities include the exchange between legal currency and virtual currency and virtual currency, basically covering currency issuance, trading, and derivatives investment. Many people wonder, does it mean that virtual currency investment or trading is illegal?

In fact, the second point has a very key word “business”. In other words, this provision is aimed at virtual currency-related business activities, not personal activities.

Since it is a business activity, it is the commercial behavior of an individual or an organization for the purpose of profit. This kind of work is generally a planned and continuous business operation.

Personal activities are generally accidental, incidental, and have nothing to do with business activities.

Therefore, individuals who hold, buy and sell virtual currency, as long as they are not systematic commercial behaviors and have nothing to do with other related illegal and criminal acts, will generally not be held accountable for any legal responsibility.

What other related illegal and criminal acts mean?

Although individuals generally do not break the law, if they are involved in some criminal activities, they will naturally be unable to escape.

At present, as the craze of virtual currency continues to surge, many people will use virtual currency to carry out some criminal activities, such as fraud, money laundering and so on.

The crime of covering up or concealing the proceeds of crime: refers to the act of concealing, transferring, purchasing, selling on behalf of, or disguising or concealing the proceeds of crime by knowing the proceeds of crime and the proceeds generated therefrom. Commonly referred to as “the crime of stolen goods”. For example, after Zhang San stole the stolen goods and sold them to Li Si, Li Si still sells the stolen goods even though he knew it was stolen, which constitutes this crime.

The crime of aiding trust: refers to a natural person or entity knowing that others use information networks to commit crimes, and providing technical support such as Internet access, server hosting, network storage, and communication transmission for their crimes, or providing assistance in advertising promotion, payment and settlement, etc. The most common one is to lend a bank card to others to “run the water”. In many telecom fraud cases, quite a few judicial authorities presume that the “lender” knows that someone else has committed telecom fraud, and is convicted and punished directly based on the bank’s running water.

The crime of money laundering: refers to the source and nature of the proceeds of disguising or concealing drug crimes, organized crimes of underworld nature, terrorist activities, smuggling, corruption and bribery, disrupting financial management order, and financial fraud, and the source and nature of the proceeds. Provide a capital account, convert property into cash, financial instruments, negotiable securities, transfer funds through transfer or other payment and settlement methods, and transfer assets across borders. The author believes that the crime of money laundering can be understood as a special “crime of disguising and concealing the proceeds of crime”.

Illegal fund-raising: A new definition has been made on the basis of the “Interpretation of the Supreme People’s Court on Several Issues Concerning the Specific Application of Law in the Trial of Criminal Cases of Illegal Fund-raising” (Fa Shi [2010] No. 18). Item 8 of Article 2 of the Interpretation stipulates that funds are illegally absorbed by means of online lending, investment in shares, virtual currency transactions, etc., and comply with the provisions of Paragraph 1 of Article 1 of the Interpretation, that is, the four conditions mentioned above include unauthorized Approval, publicity, promise of return, and targeting of unspecified objects, etc., shall be convicted and punished according to the crime of illegally absorbing public deposits.

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.

Like (0)
Donate Buy me a coffee Buy me a coffee
Previous 2022-03-21 09:20
Next 2022-03-21 09:20

Related articles