In an attempt to prevent the malicious market practices in the name of “financial innovation” and “blockchain”, People’s Bank of China has issued a joint public interest statement urging to be skeptical around such claims.
The statement came from People’s Bank of China along with The Banking Regulatory Commission, Central Network Information office, Ministry of Public Security and General Administration of Market Supervision on August 24, 2018.
The document highlights on the fact that, these lawless elements uses the shadow of the aforementioned buzzwords to defraud the public with an insurance promise through “virtual currency”, “virtual assets” and “digital assets” and propounds “Such activities are not really based on blockchain technology, but rather the practice of speculating blockchain concepts for illegal fundraising, pyramid schemes, and fraud.”
Outlining some of the key features of such Ponzi schemes it says, they rely on the Internet marketing with chat tools and presents false associations with non-existent overseas groups and also creates a fictitious urgency of sales and uses public propaganda through “static gain” and “dynamic gain”.
A translated excerpt from the warning read, “The general public should be rational about the blockchain, do not blindly believe in the promise of smallpox, establish a correct monetary concept and investment philosophy, and effectively raise the awareness of risk; and actively report the illegal criminal clues found to the relevant departments”.
Last year after outlawing the ICO’s, The Chinese Government is tackling these issues of defrauding public with several intense moves, suspension of wechat accounts of crypto news publishers and blocking of nearly 120 ICO websites are prime among them.
(Quoted statements are from Google translated document)
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