Shenzhen authorities have issued a warning about the rise of illegal financial schemes involving stablecoins and other digital assets. According to local officials, such schemes pose a serious threat to the financial security of citizens.
Increase in Fraudulent Schemes
According to the city's Office for the Prevention and Crackdown on Illegal Financial Activities, fraudulent schemes are orchestrated by unlicensed entities that are taking advantage of the public's growing interest in digital finance, particularly stablecoins. These organizations often disguise themselves with terms like 'financial innovation' and 'digital assets', promising high returns, while engaging in unlawful fundraising, gambling, fraud, pyramid schemes, and money laundering.
Authorities' Recommendations
Officials emphasized that these organizations lack approval from national financial regulators and are not authorized to collect funds from the public. They urged citizens to remain vigilant and develop a critical understanding of investment offerings, avoiding blind trust in flashy promises and increasing awareness of digital financial products.
Broad National Campaign Against Fraud
Authorities also encouraged residents to report suspicious promotions involving stablecoin-related investments to local financial oversight bodies or the police. Verified reports will be thoroughly investigated, and whistleblowers may be eligible for rewards according to established regulations. This warning is part of a broader national campaign aimed at reducing reliance on the US dollar and strengthening the financial sovereignty of the country.
The warning from Shenzhen officials highlights the importance of public awareness regarding potential financial fraud. In the context of growing interest in digital assets, local residents need to be cautious and informed about investment opportunities.
