After a report from a popular bitcoin exchange, the Chinese bitcoin community is now worried about the possibility of death sentences for people that participate in ICO fundraising.
Chinese Bitcoin Exchanges Warn Against ICO Scams
Shenzhen-based exchange BTC38 issued a warning to cryptocurrency investors on June 24 advising caution when putting money into ICOs. Reporting on this advisory, Chinese publication 8BTC noted that ICO scams have become a serious problem in China over the last two months — taking advantage of “newbies” looking for the next big thing in the cryptocurrency gold rush.
Providing an English-language summary of the BTC38 warning, 8BTC listed the following statements regarding the exchange’s policy of protecting against ICO scams:
- BTC38 will not list any newly-issued ICO assets. It’s one of the principle of BTC38 not to be the first exchange for any cryptocurrency or assets
- BTC38 has never been and will not get involved in the market-making of exchange and staffs are not allowed to get involved as well.
- BTC38 will publicize plans and open bidding for “renovating coins”
8BTC reports that BTC38 also warned “newbies” about WeChat and QQ groups intended to trick inexperienced traders into investing in fraudulent ICOs.
Illegal ICO Fundraising — Punishable By Death in China?
Although controversial to the rest of the world, China has been known to execute white collar criminals found guilty of illegal fundraising. Any kind of public business fundraising that does not fall under the guidelines set by the 1997 China Criminal Law is considered illegal.
Therefore, it is quite possible that these ICOs — beyond their designation as fraudulent — could be considered in violation of the 1997 China Criminal law. As such, if caught, the ICO organizers could be put to death.
Executing white collar criminals seems silly to people outside China, but it has happened before.
The most recent finance-related execution happened in 2013. Zeng Chengjie — nicknamed “China’s Bernie Madoff” — died by lethal injection that July. According to The Atlantic, the Chinese government did not notify Chenjie’s family before the execution. His crime? Illegal fundraising and financial fraud.
31 year-old Wu Ying avoided a similar fate. After receiving a death sentence for financial fraud, Ying — once the sixth-richest woman in China — ultimately had her sentenced reduced to life in prison.
And even though the international community has called for China to reign in its finance-related executions, they still continue — although we don’t know exactly how often.
According to the Cornell Center on the Death Penalty Worldwide, China keeps the total number of executions concealed as a “state secret.” Citing estimates from various human rights organizations, the Cornell Center suggests, “China carries out thousands of executions a year, more than the rest of the world together.
So it seems like ICO fraudsters in China are playing with fire. If they aren’t careful, they will likely end up in prison, and possibly even on death row.
Do you think China will really execute illegal ICO operators? Share your thoughts in the comments down below.
Images via Pixabay, Weibo