The Current Law Enforcement Situation and Future Trends in the Virtual Money Sector

In recent years, a new term has emerged in the legal field, particularly in the area of criminal defense: "cross-regional law enforcement." This practice mainly refers to certain local judicial authorities conducting cross-provincial law enforcement for the purpose of generating revenue, rather than solely to combat crime or maintain legal order.

This phenomenon is also reflected in the field of Virtual Money, especially evident in criminal cases. From the perspective of criminal defense, there are varying degrees of controversy in some cases involving Virtual Money, whether it is procedural issues such as filing, determining jurisdiction, handling of the property involved, or substantive issues such as the elements of the crime and the definition of charges.

Due to strict regulation of Virtual Money in the country, some grassroots judicial authorities often associate Virtual Money with illegal activities and crimes. Additionally, the presence of a high-net-worth group within the Virtual Money sphere contributes to the combination of these two factors, resulting in judicial authorities cracking down on the Virtual Money sector with the same intensity as traditional economic crimes.

However, since March of this year, there have been signs that this cross-regional law enforcement may be subject to certain restrictions. It is understood that relevant departments have issued new regulations regarding the handling of corporate crime cases across provinces, imposing stricter requirements on public security organs handling corporate cases across provinces. This policy change seems to bring a glimmer of hope to the Virtual Money industry.

As a lawyer specializing in criminal defense related to Virtual Money, we often encounter cases involving various charges, including the crime of organizing and leading pyramid selling activities, the crime of operating a casino, the crime of illegal operation, the crime of assisting information network criminal activities, and the crime of concealing or disguising criminal proceeds, among others. In addition, there are also traditional crimes of fraud, theft, and computer-related crimes.

It is worth noting that criminal cases in the field of virtual money are often classified as cyber crimes, and the jurisdiction of cyber crimes is quite broad. According to current regulations, cyber crimes include traditional computer crimes, specific crimes related to the internet, and other crimes committed through the internet. Regarding jurisdiction for filing a case, in addition to the location where the crime occurred, it may also involve multiple locations such as the residence of the suspect, the location of the network server, and the location of the service provider.

Although the new regulations mainly target inter-provincial cases involving enterprises, many virtual money cases do not involve companies, which means that even with new regulations, the virtual money industry still faces the risk of cross-regional law enforcement. Therefore, it seems unrealistic to completely terminate this practice in the short term.

Looking back at the development of the Virtual Money industry, the industry has undergone a series of changes since the regulatory policies in 2017. In the Web3 field, the debate over Virtual Money and blockchain technology has never stopped. Even Singapore, which has a relatively high degree of financial openness, will implement new Web3 policies starting June 30, mainly affecting the Virtual Money sector.

These phenomena indicate that there is an inherent contradiction between decentralized Virtual Money and centralized regulation. The ideal solution may be for both sides to learn to adapt to each other and find a balance to achieve coexistence and development. Only in this way can we protect innovation while also ensuring the stability and security of the financial system.