Chinese Student Sentenced to 4.5 Years Prison for Cryptocurrency Fraud

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In a landmark case, 24-year-old Chinese student Yang Qichao was sentenced to 4.5 years in prison for fraud involving the BFF token. Yang issued the token on a public blockchain and withdrew liquidity, causing investor Luo to lose 50,000 USDT. The High-tech Industrial Development Zone People's Court in Nanyang, Henan Province, found Yang guilty on February 20, 2024, and fined him 30,000 RMB.

Yang promoted BFF to investors, but his sudden withdrawal of liquidity led to the token's value plummeting, resulting in Luo's significant financial loss. Despite Yang's defense arguing that both parties understood the risks and that the token’s value had increased post-incident, the court ruled his actions as premeditated fraud.

This case underscores the legal risks of virtual currency trading in China, emphasizing that such investments may not be legally backed and could result in total loss. The Chinese government's recent stringent stance on cryptocurrencies provided context for the judgment. The People’s Bank of China and other authorities have repeatedly warned about the dangers of investing in virtual currencies.

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Banu Priya 2
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