Shenzhen Warns of Stablecoin Scams as Neighboring Hong Kong Pushes Ahead

Authorities in Shenzhen announced a public warning on Monday, warning residents to avoid frauds involving stabil and quoting difficulties in illegally collecting funds and fraud associated with cryptocurrencies.

“Recently Stablecoini received a wide attention from the market,” a working group for illegal financial activities in the city said. “Supervision has found that some illegal institutions use” financial innovation “and” digital property “as tricks and exploit the misunderstanding of the public in the absence of understanding stable views.”

The working group warned that these activities related to illegal funds, gambling, fraud, pyramid schemes and money laundering. The public was encouraged to report such incidents to the authorities, and the awards are available for advice.

Despite the official bans that limit the access to cryptocurrencies, trading remains widely widespread in China. It also remains a significant vector for fraud who targets both the citizens of the mainland and the victims abroad. Chinese groups of organized crime are also managed by the unions of fraud throughout Southeast Asia.

The Shenzhen warning follows the post 30 of June at Weibou by the Chinese giant e-trade jd.com, warning Users about the false promotions of “JD Stablecoin”. It is unclear whether Shenzhen’s warning is specially related to this outcome.

Company, which is search Licenses for issuing stable views abroad to pay for businesses and business, explained that no official coins were published. Any claims for the opposite, said, are false.

On Monday, Hong Kong Economic Journal also published An article on the alleged Ponzie scheme called Xin Kang Jia, which, among other things, masked as a stable investment platform. He attracted two million victims since his founding in the Chinese province of Guizhou 2021, resulting in 13 billion RMB ($ 1.8 billion) by investor losses.

Short walk

Still, just across the border in Hong Kong, from Shenzhen – where visitors can walk between the two cities – regulators differ.

It’s a city preparation To implement the new Stablecoins regulatory frame in August. Only licensed companies will allow you to issuing or the token market relating to FIAT.

Financial secretary Paul Chan reaffirmed the support of Hong Kong for that sector last month, connecting Stabbleco’s development with Asian, and especially in China, an increasing interest in resolving trade in local currencies instead of US dollars.

Stablecoins, he said, “provide a cost -effective alternative to the traditional finance system,” and could reshape cross -border payments and capital markets.

Sean Lee, co -founder of Digital Asset Tech Company Ida, said Decipher This is a Hong Kong regulation “very progressive compared to other jurisdictions.”

“It leaves more openness from the perspective of the international market, allowing multiple currency to issue more than a local currency such as UAE, and also to accept the use of public networks,” he said.

“However, it sets a fairly high tape to enter the market.”

For now, Hong Kong’s focus is more to use business to business than on retail apps, the trend echoed in JD.com Stablecoin plans and those other companies and banks that explore technology.

This shift is partly due to the ignorance of the public with stable stems, Lee added. “Also, domestic digital payment is already extremely advanced here.”