(Yicai Global) Feb. 7 -- Regulation by national governments poses the risk that some cross-border virtual currency platforms will be banned in their host countries, Beijing Internet Finance Industry Association (BJIFIA) announced yesterday.
Stricter regulation in China has driven virtual currency platforms, initial coin offering platforms, virtual digital asset transaction platforms and payday loan platforms to shift their business activities abroad, with some social platforms and non-banking payment institutions providing services and facilities for these businesses and inducing the gullible to continue to ply these high-risk financial businesses. Various platforms have even evolved into vehicles for such crimes as cross-border illegal fundraising, trans-frontier money-laundering, interstate financial fraud, transnational pyramid schemes, illegal transactions, infringement of privacy, market manipulation, illegal issuance of securities and illegal issuance of virtual currency and bonds.
With national governments tightening the regulation over crypto-currencies, ICOs, virtual digital asset transactions and payday loans, some of these overseas institutions now face the risk of a ban in their host countries, and access to some institutions has been restricted because of their obvious technical and compliance risks. Against this background, domestic financial consumers assume definite risks when speculating in the businesses of these overseas institutions, per the announcement.
Financial consumers should identify the nature of virtual currencies, ICOs, virtual digital asset transactions and payday loans and relevant businesses, enhance their awareness to avert financial risks, legally and reasonably avoid these perils and protect their legal rights and interests, and that they should fully understand the laws, regulations and policies of the relevant countries, rationally assess investment risks, and not participate in any transnational financial crimes, such as illegal fundraising, money-laundering, financial fraud, pyramid schemes, illegal transactions, privacy infringement, market manipulation, illegal issuance of securities and illegal issuance of virtual currencies and bonds, BJIFIA advises.