The Beijing Internet Finance Industry Association (BIFA) issued a notice on July 9 urging retail investors to reject pitchbooks that wrap old-style pyramid sales in crypto terminology.

According to local news outlets, BIFA said promoters have begun advertising “stablecoin wealth plans,” “Web 3.0 dividends,” and similar offers that promise fixed returns. 

The circular listed five hallmarks of illegal fundraising: operating without a licence, using technical jargon to amplify information gaps, issuing false guarantees, recycling new deposits to pay earlier participants, and cross-linking into fraud or money laundering. 

BIFA advised the public to verify a firm’s licence through national regulators and to be aware that high returns often carry high risk. 

It also reminds victims that China’s Regulation on the Prevention and Disposition of Illegal Fundraising holds the investor liable for any losses. The reports highlighted that the warning totals nearly 1,500 Chinese characters and appeared first on BIFA’s verified WeChat channel.

Read the full story at CoinTelegraph.