China’s Supreme Court this week set penalties for violating recent prohibitions against engaging in cryptocurrency transactions.
Engaging in “illegal fundraising” — the Chinese government’s term for a category of offenses that includes using cryptocurrency — encompasses transactions using “the internet, the media, promotion conferences, leaflets, mobile phones information and other means to publicize it to the public,” the announcement states, according to a Google translation of the official web page.
The penalty, according to China’s Supreme Court, in many cases should be a prison sentence of at least 10 years and a fine valued Thursday (Feb. 24) at $79,100.
When Chinese authorities announced Sept. 24 that cryptocurrency banking transactions were illegal, no fixed punishments were attached to violations.
The rationale for the law, authorities stated at the time, was that “virtual currency trading hype activities have risen, disrupting economic and financial order, breeding illegal and criminal activities such as gambling, illegal fundraising, fraud, pyramid schemes, and money laundering, seriously endangering the safety of people’s property.”
The Chinese Supreme Court, in explaining the reasoning for the firm sentences for people caught engaging in cryptocurrency, listed similar reasons.
While the September 2021 law applies to foreign people or entities on the other side of cryptocurrency transactions with people in China, such offenses do not appear to have been listed in the penalty schedule issued this week.
Further complicating matters, Chinese regional governments appear to treat crypto-related enterprises differently. Cryptominers can be in favor in one place at one time and then out of favor in the same place another time or in a different place at the same time.