China's Supreme Court Rules Crypto Transactions Constitute 'Illegal Fundraising'

China's Supreme Court ruled Thursday that virtual asset transactions constitute "illegal fundraising," paving the way for judicial prosecution of the crypto industry.

  • While the People's Bank of China and a host of other top-level agencies had declared that crypto transactions are illegal fundraising back in September 2021, the court ruling formally designates them as a crime and determines related punishments.

  • Thursday's ruling said that suspects will be prosecuted according to Article 176 of China's criminal law, which stipulates prison sentences between three and ten years and fines between RMB 50,000 ($7,900) and RMB 500,000 ($79,000) for crimes involving large sums of money. Less serious crimes will be prosecuted with under three years of prison and RMB 20,000 ($3,160) to RMB 200,000 ($31,600) in fines, according to the criminal law.

  • The amendment comes into effect on March 1.

  • Chinese provincial authorities continue to crack down on the industry. The eastern province of Zhejiang announced increased electricity tariffs on Wednesday for crypto mining, joining Hainan and Inner Mongolia.

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