Comprehensive interpretation: The central bank’s new law prohibits the issuance of tokens. For the first time tokens enter the law, is the token issuer in danger?


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On the evening of October 23, the People’s Bank of China issued a notice for public comments on the “People’s Bank of China Law of the People’s Republic of China (Revised Draft for Solicitation of Comments)”.

This law is the first time that China has incorporated “tokens” involving virtual currencies and encrypted currencies into the law. It should be noted that the inclusion of relevant content into the law is very rigorous, especially for emerging things, otherwise it may not keep up with the changes of the times.

Therefore, it can be seen that the core of the updated law is the strict prohibition on the issuance of tokens. This may also be a red line drawn by decision makers after a long discussion, but there are still some ambiguities to be explained later.

The opinion draft mentions cryptocurrency in three places.

1: In the explanation, it is stated that the “Draft for Comments” stipulates that the RMB includes physical and digital forms, and provides a legal basis for the issuance of digital currency; prevents virtual currency risks, and clarifies that any unit or individual is prohibited from making and selling digital tokens

2: Article 22 (Tokens) No unit or individual may make and sell tokens, coupons and digital tokens to replace RMB in circulation in the market.

3: Article 65 (Responsibilities for the production and sale of tokens) Where tokens, coupons and digital tokens are produced and sold to replace Renminbi in the market, the People’s Bank of China shall order the cessation of illegal activities and destroy the illegal production and sale For token tickets and digital tokens, the illegal income shall be confiscated, and a fine less than five times the illegal amount shall be imposed; if the illegal amount cannot be determined, a fine of 100,000 yuan up to 500,000 yuan shall be imposed. If the circumstances are serious,

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Punishment in accordance with the second paragraph of Article 61.

Add a comparison with the 2003 version, the picture is from Huo Xiaolu.


This law is a continuation of the Central Bank’s 94 ban. The 94 prohibition prohibiting 1CO is actually prohibiting currency issuance, saying that it is essentially an unauthorized public financing behavior, suspected of illegal sale of tokens and coupons, illegal issuance of securities, and illegal fundraising, financial fraud, pyramid schemes and other illegal and criminal activities.

Attorney Huo Yijie believes that this revision of the law also reaffirms the spirit of the original documents and rises to the legal level to continue to strengthen deterrence and enforcement. Article 65 of the “Draft for Soliciting Opinions” is mainly to increase penalties. For the illegal production and sale of tokens, tickets and digital tokens, the fines have been substantially increased.

Wu said that Blockchain consulted with special legal advisors Xia Wei and Huo Yijie, and their comprehensive views are as follows:

First, the regulatory documents on Bitcoin in 2013 are still in effect, that is, Bitcoin as a virtual commodity is still legal to buy and sell. The judgments of the Hangzhou Internet Court last year and the Shanghai No. 1 Intermediate People’s Court further determined that Bitcoin belongs to the virtual network. property. reference””

Second, it emphasizes that it must not “replace the renminbi in the market.” For example, the ZB exchange previously anchored the QC of the RMB and Tether anchored the CNHT of the RMB, which is illegal according to this definition. The criterion for judging whether to replace the renminbi is whether it is possible to appear in the market on a large scale in a role similar to “fiat currency” for people to consume and exchange. As a legal currency, the core of the renminbi is legal repayment and compulsion, that is, in all debt relations within my country, one party provides renminbi payment, and the other party must not refuse for any reason. This is a feature that any other unofficially issued currency cannot have.

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Third, the principles of the new law will not go back to the past. Because it is not a criminal law, the overseas institutions do not have jurisdiction. But if the person in charge is a Chinese citizen, the law has the power to exercise jurisdiction over that citizen. Generally, those who purchase tokens will not pursue payment, and the issuer is mainly held accountable. For organizations that use overseas entities to issue currency, if they comply with local policies and laws, theoretically investors, including domestic investors, should bear the relevant transaction risks themselves. There are two exceptions. The first type of malicious circumvention of domestic policies by deploying overseas servers can be reported to the regulatory authorities; the second type of suspected criminal activities can be reported to the public security organs.

Fourth, some details have yet to be explained by the legislature. The core is what type of tokens and tickets are sold illegally? Is it not illegal as long as it does not replace the status of RMB? Is the Q coin issued by Tencent and the brand coin issued recently by CCTV illegal?

Fifth, in any case, the law has provided a powerful deterrent for domestic institutions to issue currency. Some domestic public chain projects that have not issued currency are likely to slow down; some institutions with responsible persons in the country may also suspend currency issuance. ; This is probably not good news for some early investors and cryptocurrency entrepreneurs in China.

Sixth, the 94 ban not only prohibits the issuance of coins, but also prohibits the trading platform, but this issuance only involves the issuance of coins, and does not explicitly prohibit the platform from engaging in the trading and exchange of mainstream cryptocurrencies such as Bitcoin and Ethereum. Does it leave a hole in the future?

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Regarding formal virtual currency trading activities, my country has not prohibited it, but has always been cautiously discouraging. The reason is that there are all kinds of illegal financial activities in the market “under the cloak of legal finance”. Many investors do not have sufficient identification ability and are easily deceived.

Attorney Huo emphasized that applying the sales principles of traditional financial products has always been “the seller is responsible and the buyer is responsible.” That is to say, when the seller has fulfilled the obligations of prudence and risk warning, the related transaction risks are borne by the buyer. As a qualified investor, he cannot enter the market decisively in the face of the temptation of high returns, and once he suffers losses, he will blame the relevant transaction for illegality and want to get back the principal.

Refer to Huo Xiaolu “”