Shenzhen authorities warn citizens about the risks of scams related to stablecoins and digital assets.

Fraudulent groups use the guise of 'innovative finance' and 'digital assets' to lure investors, disrupting the financial system and increasing illegal activities such as illegal fundraising, gambling, and money laundering.

MAIN CONTENT

  • Shenzhen authorities warn about scams related to stablecoins.

  • Citizens are advised to exercise caution, verify investments, and report illegal activities.

  • The Chinese government strictly prohibits cryptocurrency and encourages the use of the official digital yuan.

What do Shenzhen authorities warn about stablecoin scams?

Representatives of the Shenzhen government affirm that illegal organizations are exploiting the trend of digital assets, especially stablecoins, to propose fraudulent fundraising models, harming investors and disrupting the financial market.

According to a report from the Shenzhen Office for Combating Illegal Financial Activities on July 7, 2024, many groups have used terms like 'financial innovation' and 'digital assets' to infiltrate illegal activities such as illegal fundraising, disguised gambling, and pyramid schemes.

"We have detected new forms of scams using stablecoins as bait, negatively impacting the city's financial security."

Mr. Li Youfeng, Head of the Shenzhen Office for Combating Illegal Financial Activities, 7/2024

What do citizens need to do to protect themselves from digital asset risks?

The Shenzhen authorities emphasize the importance of thorough due diligence and vigilance when engaging in digital asset investments, encouraging citizens to verify legality before making decisions.

Citizens are also advised to actively report illegal organizations or unlicensed fundraising activities to the city's authorities or local police to ensure timely action.

"All reports will be carefully verified, strictly handled according to regulations, and individuals providing accurate information will be rewarded."

Statement from the Shenzhen Office for Combating Illegal Financial Activities, 7/2024

Why is China tightening regulations on cryptocurrencies and stablecoins?

The Chinese government has completely banned cryptocurrency to protect the national financial system and prioritizes the development of a state-controlled digital yuan.

The law strictly prohibits illegal fundraising, in which investors must bear all risks of losing money. The Shenzhen government emphasizes that it will not tolerate financial activities outside the law and promotes personal responsibility in investing.

Real-life examples demonstrate the severity of these scams.

Previously, many fraudulent fundraising schemes disguised as stablecoins had defrauded hundreds of millions of yuan, adversely affecting investor trust and disrupting the local financial market.

This leads authorities to enhance supervision and coordinate responses, while widely promoting the digital yuan, which has high transparency and state control.

Final summary of the actions of the authorities and citizens.

Shenzhen authorities express their determination to prevent all forms of illegal stablecoin and cryptocurrency scams, directing citizens towards safe and lawful investment channels. The state focuses on developing the digital yuan as the only official financial tool.

Citizens need to raise awareness, be vigilant against new tricks, and use official channels to protect their assets.

Frequently Asked Questions

1. Why is the Shenzhen government warning about stablecoins?

Due to numerous scams using stablecoins as a facade to raise illegal funds, causing financial harm to citizens.

2. What should citizens do when encountering unclear digital asset investment forms?

Conduct thorough due diligence, verify legality, and report immediately to the authorities for assistance and resolution.

3. Does China allow investment in individual cryptocurrencies?

No, China has banned all cryptocurrency activities outside of state control and prioritizes the development of a digital yuan.

4. What tricks do scammers commonly use?

They use the trick of 'financial innovation', creating fake fundraising models, gambling, and distorted multi-level marketing.

5. Does the government have a policy encouraging citizens to report illegal activities?

Yes, individuals providing accurate information will be rewarded according to legal regulations.

Source: https://tintucbitcoin.com/canh-bao-lua-dao-tien-dien-tu-tham-quyen/

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