Cryptocurrency card freezing trend (7): OTC transactions that violate these 7 rules may be considered a crime, so be careful

(The author is lawyer Xia Wei, who has extensive experience in handling frozen cards in the cryptocurrency world. He is authorized by WuShuoBlockchain to publish this exclusively.)

For those who do OTC trading, the most anxious thing is whether what they do is a legal business. You know, OTC trading is hard-earned money. You have to save money and hoard coins first, then work hard at the computer every day, and endure the fluctuations in the coin price, and finally you can make some profits.

Hard work is acceptable, after all, it is for the purpose of making money. But if it leads to jail time, it would be a big loss. I am a good citizen, working diligently on the computer every day to do business, earning hard-earned money, but I end up getting myself in jail accidentally, why bother?

But there is no way around it. Digital currency is not welcomed in China. It is not acceptable in the official eyes. People can tinker with it as they please, but they cannot commit crimes. However, digital currency is favored by bad guys. After all, it is easy to circulate (it only takes a few minutes to get from one end of the earth to the other), anonymous (the deposit and withdrawal addresses are a bunch of numbers and letters), and easy to cash out (over-the-counter transactions). It is simply a perfect medium for making money.

According to judicial case searches, there have been 158 criminal cases involving digital currency since 2016 , including various crimes such as pyramid schemes, fraud, drug trafficking, and theft. It should be noted that regular buying and selling of digital currency is 100% legal. In 2013 , a document from five ministries and commissions confirmed that digital currency is a legal item. Since it is a legal item, there will be no problem in buying and selling it. Many judicial decisions since then have also confirmed this point.

OTC merchants buy and sell digital currencies. They buy digital currencies at low prices with legal tender online, and then sell them at high prices for legal tender, making a profit from the difference. Therefore, for OTC merchants, most of the crimes involved have nothing to do with them.

Except for one: concealing and concealing the proceeds of crime and the profits from the proceeds of crime.

In the cases retrieved, the people involved were basically guilty of some improper behavior during the digital currency trading process. Therefore, over-the-counter traders must pay great attention to this crime.

Let’s look at this sin in detail:

[Crime of concealing or hiding criminal proceeds and proceeds from criminal proceeds] Whoever knowingly conceals, transfers, purchases, sells on behalf of others, or conceals or hides criminal proceeds and proceeds from criminal proceeds shall be sentenced to fixed-term imprisonment of not more than three years, criminal detention or public surveillance, and shall be fined or fined alone; if the circumstances are serious, he shall be sentenced to fixed-term imprisonment of not less than three years but not more than seven years, and shall be fined.

If an entity commits the crime in the preceding paragraph, the entity shall be sentenced to a fine, and the directly responsible supervisor and other directly responsible persons shall be punished in accordance with the provisions of the preceding paragraph.

I don’t know if you have noticed that the key to distinguishing whether it is a crime or not is knowing that it is the proceeds of crime and the income generated by it. In other words, if you know that the money you buy coins comes from a crime and you still trade with the other party, you will commit this crime.

At this point, everyone will probably breathe a sigh of relief. After all, if you don’t take the initiative to ask, who knows where the other party got the money? Even if you ask, the other party won’t tell you, so it must be fine.

It’s actually not that simple.

The definition of "knowingly" here is not what we think, but has a special legal definition:

(1) Knowing that another person is engaged in criminal activities, assisting in the conversion or transfer of property;

(2) Assisting in the conversion or transfer of property through illegal means without justifiable reasons;

(3) Purchasing property at a price clearly below the market price without justifiable reasons;

(4) Assisting in the conversion or transfer of property without justifiable reasons and charging “handling fees” that are significantly higher than the market price;

(5) Without justifiable reasons, assisting others to deposit large amounts of cash in multiple bank accounts or frequently transferring cash between different bank accounts;

(6) Assisting close relatives or other closely related persons to convert or transfer property that is obviously inconsistent with their occupation or property status;

(VII) Other circumstances of which the perpetrator may be deemed to have been aware.

From this, we can see that for an OTC merchant, if he receives coins at too low a price, charges too high a handling fee, helps people deposit money in multiple accounts, and helps acquaintances deposit large amounts of money from unknown sources, it is considered " knowingly " . In other words, as long as he does these things, he is suspected of committing a crime, even if he does not know the source of the money.

If over-the-counter merchants are asked to do this kind of thing, they must not agree no matter how high the offer is, otherwise they will really be put in jail.

Please refer to this case "Exclusive: Suspected Nanning OTC Trader Arrested for Using USDT to Launder Money for Telecom Fraud"