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China issues a warning against illegal fundraising and trading activities involving cryptocurrencies

China’s regulatory agencies have jointly issued a warning against illegal fundraising and trading activities involving cryptocurrencies.

The warning was issued on August 24 by six high-level regulators: the People’s Bank of China, the Banking Regulatory Commission, the Securities Regulatory Commission, the Ministry of Public Security, the Central Cyberspace Affairs Commission, and the State Administration for Market Regulation.

It aims at cryptocurrency projects that set up operations using overseas IP addresses but solicit investment from Chinese residents and use mobile and internet payments tools to facilitate cryptocurrency trading.

“Some of these projects tap celebrities and airdrop ‘candies’ as ways for promotion and solicitation. … In fact, they manipulate the prices of such cryptocurrencies to make profits illegally,” – the regulators wrote in the warning, adding:

“Some individuals claim in chat groups on messaging applications that they are able to invest in overseas crypto projects on behalf of domestic investors as a broker. … These claims are highly likely to be fraudulent.”

The regulators warned the public against new fundraising methods other than initial coin offering – including “initial exchange offerings”, “initial fork offerings” and “initial miner offerings” – as ways to speculate on cryptocurrencies.

Earlier this week, Chinese regulators said they are going to block more than 100 foreign crypto exchanges offering trading services to domestic investors.