Odaily Planet Daily News Recently, the People's Court of Songjiang District, Shanghai concluded a case involving a dispute over the effectiveness of a virtual currency issuance financing service contract. The specific case shows that in 2017, an agricultural development company (Company X) signed a (blockchain incubation agreement) with an investment management company (Company S) because it was optimistic about the development of virtual currency, paying 300,000 yuan in service fees for token issuance. However, the plan ultimately fell through, leading Company X to sue in the People's Court, requesting the termination of the contract and the return of the 300,000 yuan service fee by Company S. The People's Court of Songjiang District ultimately ruled that the agreement was invalid, ordering Company S to return 250,000 yuan. The People's Court determined that token issuance financing refers to the financing entity raising so-called 'virtual currencies' such as Bitcoin and Ethereum from investors through the illegal sale and circulation of tokens, which is essentially an unauthorized public financing activity that is illegal and suspected of illegal token issuance, illegal securities issuance, illegal fundraising, financial fraud, pyramid schemes, and other criminal activities. Therefore, no organization or individual may illegally engage in token issuance financing activities. Participating in virtual currency investment transactions carries legal risks; any legal entity, non-legal entity, and natural person investing in virtual currency and related derivatives that violate mandatory legal regulations will find their related civil legal acts invalid, and the resulting losses will be borne by themselves. Thus, although individuals merely holding virtual currency is not illegal, commercial entities cannot arbitrarily engage in virtual currency investment transactions or issue tokens on their own. Once they touch the bottom line of civil and criminal legal principles and rules in their trading activities, they may suffer losses or, in severe cases, be suspected of committing a crime. (Shanghai High Court)