The Securities and Futures Bureau announced the warning regarding "Crypto Hu Shih".
The Securities and Futures Bureau of the Financial Supervisory Commission issued a warning announcement yesterday (12/17) regarding the well-known cryptocurrency influencer "Crypto Hu Shih" and its operating company, Yang Ji Co., Ltd., pointing out that the operator has not completed the compliance declaration required by the Anti-Money Laundering Act and is prohibited from engaging in virtual currency-related business solicitation activities. This is the first KOL (Key Opinion Leader) to be warned since the virtual asset registration system was implemented this year.
Source: Financial Supervisory Commission, Securities and Futures Bureau Non-FSC Approved Securities and Futures Operators and Products Warning Area
According to the announcement from the Securities and Futures Bureau, Yang Ji Co., Ltd. has not completed the relevant registration under the (Anti-Money Laundering Registration Regulations for Enterprises or Individuals Providing Virtual Asset Services), nor has it completed the compliance declaration required by the Financial Supervisory Commission. Therefore, it is prohibited from conducting any virtual currency platform business solicitation activities. The Securities and Futures Bureau reminds investors to avoid trading virtual currencies with this company and not to remit funds to its accounts.
According to company registration data, Yang Ji Co., Ltd. is located in the Xinzhuang District of New Taipei City, approved for establishment in March 112, with a capital of 200,000 TWD, mainly engaged in retail and wholesale, international trade, and consulting services. However, the company has not applied for a permit for virtual asset-related business, which is obviously inconsistent with its actual operation of virtual currency business.
Source: Taiwan Company Network Yang Ji Co., Ltd. has not applied for a permit for virtual asset-related business, which is obviously inconsistent with its actual operation of virtual currency business.
KOL Recommends Cryptocurrency Courses, Causing Controversy
In addition, Crypto Hu Shih conducts daily technical analysis and provides cryptocurrency investment courses through social media, YouTube channel, and other online platforms. The course fees are categorized by level: beginner class 6,200 TWD/year, intermediate class 9,300 TWD/year, and advanced class 15,500 TWD/year. Although these contents are marked as 'simulated capital operations, not investment advice', they still attract many followers to join.
However, the Securities and Futures Bureau pointed out that courses and services involving virtual asset trading platforms must complete the registration and declaration process in accordance with the law. Engaging in related activities without approval has violated current regulations and may face further investigation and penalties.
In addition to the courses, Crypto Hu Shih will also share market trend analysis in the videos, such as recent discussions on Litecoin ($LTC) long-term target price ranges, prompting some users to follow suit. Despite repeatedly stating that its content is for reference only, it may still touch upon legal boundaries.
Source: 'Crypto Hu Shih' Fan Page
Industry turbulence and investor vigilance
This incident not only reveals the challenges of law enforcement and regulation in the virtual asset market but also casts a shadow on investors' trust in 'KOL recommendations'. As the cryptocurrency market rapidly develops, related risks are gradually surfacing. How to balance innovation and regulation has become a common issue faced by various countries.
The Financial Supervisory Commission emphasizes that investors should avoid participating in unapproved virtual currency businesses and can check the list of legal operators on the Securities and Futures Bureau website. Operators engaged in virtual currency-related activities must comply with the anti-money laundering registration process to ensure market transparency and safety.
As for whether "Crypto Hu Shih" will accept legal investigation subsequently, the industry is concerned about whether it can complete the relevant declarations and continue operations. However, this incident has sounded the alarm for other cryptocurrency KOLs, reminding operators that they must comply with the law to avoid damaging their reputation and business development due to legal risks.
(Legal Tips from Crypto City)
Due to the current concerns of most people regarding KOLs promoting cryptocurrencies, there was a previous (Crypto City) compilation of (Taiwan's Virtual Asset Self-Regulatory Guidelines for Dummies), which interested readers can refer to. Regarding this incident, we also asked our legal staff the following three questions for readers' reference, hoping that everyone will not face legal disputes due to crossing the line:
1. Where can readers see related announcements?
Currently, there is only an announcement regarding the investigation (content in the warning area), but the industry believes that Hu Shih may be involved in actions that violate the Futures Trading Act and the Investment Trust and Consulting Act. Due to the involvement in criminal cases, verification is currently impossible (investigation secrets are not disclosed).
2. How does the legal staff view this matter?
According to existing information, "No business activities soliciting virtual currency platform operations can be conducted" by unregistered operators. They are not allowed to operate, solicit, or engage in commercial activities related to virtual currency platforms. A simple way to distinguish the work tasks of exchanges is that they need to be approved by the competent authority. Furthermore, Hu Shih's business solicitation activities can be interpreted as an extension of exchange business operations, and this extension needs to be registered under the 'Anti-Money Laundering Registration Regulations for Enterprises or Individuals Providing Virtual Asset Services'. Of course, it does not rule out the possibility that Hu Shih solicits business for unapproved exchanges, and the red line is set here.
Virtual currency platforms (domestic virtual asset platforms and transactions) refer to engaging in the following activities for others.
Exchange between virtual assets and New Taiwan Dollar, foreign currencies, and currencies issued in mainland China, Hong Kong, or Macau.
Exchange between virtual assets.
Transfer of virtual assets.
Custody, management of virtual assets, or provision of related management tools.
Participation in and provision of related financial services for the issuance or sale of virtual assets.
3. Are there any precautions or suggestions to consider?
If the business model involves virtual assets, trading actions should be conducted through compliant exchanges to avoid direct solicitation or obtaining a reciprocal relationship with exchanges; it is necessary to assess whether the partnered exchanges comply with government supervision mechanisms and carefully evaluate. It is still recommended to cooperate with compliant exchanges.
[Disclaimer] The market has risks, and investment should be cautious. This article does not constitute investment advice, and users should consider whether any opinions, views, or conclusions in this article align with their specific circumstances. Investing based on this, you bear the responsibility.
'Taiwan's Cryptocurrency KOL Gets into Trouble! Crypto Hu Shih Warned for Illegal Solicitation, Lawyers Teach 2 Tips to Avoid Crossing the Line' This article was first published in 'Crypto City'.
