Traffic is the currency of the internet, but venturing into the financial sector without proper authorization crosses a strict legal boundary. Recent enforcement actions highlight the significant legal perils for online influencers who engage in unlicensed financial activities. According to a Sina Finance report, a financial blogger with millions of followers faced investigation for sharing investment advice. This underscores that under China’s penetrating regulatory scrutiny, ‘operating financial business without a license’ is decisively punishable. Some Web3 influencers may believe promoting offshore exchanges or crypto links falls outside domestic jurisdiction. Legal experts assert this is a misconception: such activities are subject to stringent oversight. Financial licensing is a non-negotiable requirement. Two domestic cases illustrate the severe consequences of unlicensed ‘financial influencing’: **Case 1: Illegal Business Operation Crime (Influencer Wu)** The defendant, lacking securities investment advisory qualifications, used his social media influence to create a paid membership ‘circle’ offering stock-picking advice disguised as ‘knowledge payment.’ This scheme generated over 12 million RMB in illicit profit. The court convicted him of illegally operating a securities business, sentencing him to over two years imprisonment and imposing a 13 million RMB fine. **Case 2: Illegal Business Operation Crime (Financial Blogger Xu)** This case more closely resembles Web3 ‘trade copying’ models. The blogger knowingly promoted an illegal ‘off-site仓位 allocation system,’ directing followers to open accounts and trade options. He earned a 20 RMB commission per trade, involving transaction volumes exceeding 16 million RMB. He was also convicted of illegal business operation. A comparative analysis reveals heightened risks in the Web3 space. Unlicensed recommendation of regulated products like stocks is already illegal. However, promoting Web3 activities—which may inherently involve risks of ‘illegal fundraising’ or ‘illegal securities activities’ in China—and engaging in practices like ‘contract copy-trading’ or ‘cross-border commission rebates’ constitutes a more severe violation of expressly prohibited red lines. **Deconstructing High-Risk Web3 Practices** From a mainland China legal perspective, three prevalent models carry substantial risk: 1. **’Copy-Trading’ Model:** Traders attract followers to automatically replicate their trades via exchange features, taking a 10%-30% profit share. Managing others’ assets this way without a license may constitute illegal business operation. 2. **’Domestic User Referral & Rebate’ Model:** Influencers share exclusive registration links or rebate codes, often using domestic social media accounts to build trust. This targeted solicitation of mainland users may be deemed illegal business solicitation within China, significantly elevating legal liability. 3. **’Loss-Based Profit Sharing’ Model:** The most hazardous practice involves agreements where influencers profit directly from user trading losses. This transforms the relationship from potentially违规 promotion to涉嫌 fraud. **Three Key Criminal Red Lines** Legal experts identify several potential criminal charges: 1. **Illegal Business Operation Crime:** Large-scale promotion of virtual asset trading or settlement activities may be interpreted as illegal fund payment settlement or unlicensed securities/futures business. 2. **Crime of Aiding Information Network Criminal Activities:** Promoting platforms involved in money laundering, fraud, or unauthorized domestic operations can lead to charges for assisting criminal activities, especially if ‘knowledge’ of the illegality is presumed. 3. **Fraud Crime:** Involvement in ‘loss-based profit sharing’ schemes can elevate charges to fraud as an accomplice, as it involves misrepresenting the profit motive and concealing the intent to benefit from client losses, potentially leading to sentences exceeding ten years. **Compliance Guidelines for Digital Intermediaries** To mitigate risk, experts advise: – **Separate Content from Commerce:** Keep analytical or educational content strictly separate from promotional links, rebate codes, or invitations. – **Clarify Geographic Service Limits:** Clearly state that services are not targeted at mainland Chinese users on all channels, which can serve as evidence against intent to solicit domestically. – **Scrutinize Revenue Sources:** Immediately cease any profit model tied to user losses. Recognize that income from transaction fee splits or copy-trading profits still supports unlicensed quasi-financial activities. – **Establish Content Boundaries:** Avoid providing specific trading advice, ‘喊单’ (trade calls), or promises of returns in public content. Focus on technological trends rather than investment guidance. **Conclusion** While Web3 represents innovation, the global legal principle remains: financial business operations require proper licensing. As digital intermediation faces clearer and stricter legal boundaries, influencers must recognize that traffic used to guide users into non-compliant financial activities can transform from a tool of dissemination into a vector for legal liability. The future belongs to those who innovate within established regulatory frameworks.