Beijing Industry Group Warns Against DeFi Ponzi Schemes

Beijing Internet Finance Industry Association (BIFA) issued a warning on July 9, 2025, through their verified WeChat account highlighting concerns regarding certain Web3 and DeFi high-return deals.

BIFA warns investors due to repeated patterns of fraudulent schemes, raising concerns within the crypto market community.

BIFA’s latest warning targets promotions of “stablecoin wealth plans” promising fixed returns. These activities, according to BIFA, include unlicensed operations and false guarantees. The organization cites past incidents involving high-profile cryptocurrency frauds such as PlusToken.

“Promoters have begun advertising ‘stablecoin wealth plans,’ ‘Web 3.0 dividends,’ and similar offers that promise fixed returns.” — Beijing Internet Finance Industry Association (BIFA)

The PlusToken fraud, which accumulated about 200,000 BTC and 9 million ETH, serves as a historical precedent to emphasize the risk. Current schemes targeting ETH, BTC, and stablecoins continue to pose potential risks.

BIFA’s circular outlines five hallmarks of illegal fundraising activities, aiming to educate investors against suspect schemes. These include using technical jargon to exploit information gaps and cross-linking to fraud.

The Chinese crypto regulation environment emphasizes vigilance among investors, deterring risk participation in unlicensed investment schemes. While BIFA’s warning serves as a preventive measure, market trends will confirm its impact over upcoming weeks.

Should the current climate persist, heightened caution within crypto investments is expected, potentially affecting new stablecoin-related fundraising efforts. Historical patterns from cases like PlusToken underline the necessity for regulatory awareness.