China plans crackdown on illegal fundraising in metaverse, NFTs

China Supreme People’s Procuratorate warned of “severe punishment” for financial crimes such as illegal fundraising and money laundering in a work report released on Tuesday. 

See related article: ‘Metaverse’ enters government radar at China’s Two Sessions

Fast facts

• China’s highest procuratorate has taken note of rising financial crimes deemed illegal fundraising, disguised as metaverse, non-fungible token ($NFT) and cryptocurrency projects, according to Supreme People’s Procuratorate director of financial and economic crime Zheng Xinjian.
• In a local media interview published on Tuesday, Zheng said the legal system requires legislative proposals and judicial interpretations to cope with such financial crimes.
• In February, cryptocurrency was labeled illegal fundraising in a judicial interpretation.
• NFTs and the metaverse are not banned in China, unlike crypto, but state media has lashed out with warnings against speculation and illegal fundraising related to the trends.
• Yet, China has set high expectations for the metaverse, with members of the two central political bodies proposing regulation and investments in the metaverse, during the nation’s annual plenary sessions, the “Two Sessions.” 

See related article: Crypto traders in China may serve over 10 years in prison