In the virtual currency payment card (U card) business, card issuance, settlement, currency exchange and recruitment are separate roles with entirely different legal weight. This article, from the perspective of mainland China regulation and criminal law, breaks down the three types of actions taken by marketing personnel, the evidentiary paths for proving subjective knowledge, and the materials that should be prepared now and the actions that should be stopped.

The U card is not a question of a single card

A reader working in marketing asked: he only helps the company recruit people to register a card that can spend stablecoins, and takes a commission per person; recently someone on the team was called in for questioning, and he began to worry whether he counts as an accomplice. This question is neither too early nor too late. To answer it, one must first lay out the U card business chain and see clearly where one stands, through whose hands the money passes, and what kind of money one receives.

The so-called U card generally refers to a payment card that is topped up with stablecoins (such as crypto assets pegged to fiat currency, e.g., Tether) and used for spending or cash withdrawal through overseas card organization channels. Behind a single card stand at least four types of roles: the overseas card issuer or product party, responsible for designing the product and acquiring; the channel or settlement party, responsible for converting stablecoins into spendable fiat credit; the domestic marketing team, responsible for customer acquisition, building groups, giving lectures and recruiting; and the end users, responsible for topping up and spending. Marketing personnel usually do not control card issuance and settlement, but they do control customer acquisition and sales pitches, which is precisely the entry point of risk.

The flow of funds and rights deserves separate clarification. Users exchange RMB for stablecoins; this step constitutes an exchange business expressly prohibited within the mainland; the stablecoins enter overseas channels and are converted into card credit; after users spend, the card issuer settles marketing fees or rebates with the marketing team as agreed. The money marketing personnel receive may be a fixed salary, a per-person commission, or a share of downline performance. These three types of money have completely different legal meanings, which will be elaborated below.

A common misjudgment must first be corrected here: the job title does not matter. Whether one is called a marketing specialist, community partner or regional agent does not affect the substantive determination. Regulators and judicial authorities look at what actions you actually took, whether you knew the nature of the business, and whether the money passed through your hands. Likewise, signing a contract with an overseas company and being paid into an overseas account does not mean there is no connection to mainland regulation.

From the perspective of mainland China's regulatory approach, virtual currency-related business activities are illegal financial activities, and overseas entities and individuals may not, in any form, unlawfully provide virtual currency-related services to domestic entities. This means that if the substance of the U card business is providing virtual currency-related services to domestic users, then the entire chain lacks a lawful basis within the mainland. What marketing personnel need to determine is not whether "this card is lawful overseas," but "where the actions I take within the mainland sit within this prohibited chain."

Recruiting new users, publicity and developing downlines: the legal weight of the three actions is entirely different

Many marketing personnel treat "recruiting new users," "publicity" and "developing downlines" as the same thing, believing they all amount to helping the company find people. In fact, the weight of these three actions in regulatory and criminal law assessment rises in sequence and cannot be conflated.

First, simple recruitment of new users. If one merely forwards a registration link to acquaintances, who register and use it themselves, and the marketing personnel make no promise of returns, do not collect funds on behalf of others, and do not participate in subsequent transactions, this action is relatively the lightest. But "relatively the lightest" does not mean there is no risk. Regulation makes clear that domestic entities and individuals that, while knowing or ought to know that an overseas entity is unlawfully providing virtual currency-related services to the mainland, still provide assistance to it shall be held liable in accordance with law, and where a crime is constituted, criminal liability shall be pursued. Forwarding a link may itself be found to be "assistance"; it is merely shallow in depth of participation and small in profit, and thus usually sits at a lower tier in the assessment of liability.

Next, publicity and promotion. The risk at this step rises markedly, and the key is whether the sales pitch contains "promises of returns" and "functional packaging." If what is publicized is "top up stablecoins, convenient overseas spending, cross-border payments in seconds," the essence is marketing for prohibited virtual currency-related services; if "deposit coins to earn interest," "referral rebates" and "guaranteed profits" are added, it may simultaneously touch the assessment of illegal fundraising and fraud. Regulation expressly requires that internet enterprises may not provide marketing, publicity, paid traffic diversion or other services for virtual currency-related business activities, and market regulation authorities will also investigate and punish illegal advertisements involving virtual currencies. Although marketing personnel are not internet enterprises, they are themselves the actors carrying out the publicity.

The highest risk is developing downlines and tiered rebates. Once the marketing model becomes "the people you recruit recruit more people, and you continuously share in the performance of your downlines," the structure comes very close to pyramid selling. Regulation expressly lists "pyramid selling carried out under the guise of virtual currency and the like" as a target of severe crackdown. A distinction must be drawn between two types of money here: one-off marketing fees, counted per person recruited, ending when the job is done; and continuous tiered income, where the more downlines and the deeper the tiers, the more you receive. The latter is more readily found to be participation in business operations rather than the mere provision of labor services.

What does this mean for readers? If your current income structure includes 'team performance sharing,' 'downline commissions,' or 'tiered rewards,' this is no longer an ordinary marketing position; it is part of a business organization. The first thing you should do is set out your income structure clearly: which amounts are one-off service fees and which are tiered commissions. Setting this out clearly is not for the purpose of making excuses, but for knowing which line you stand on.

What truly determines the level of risk is knowledge, depth of participation, and whether money passed through you

The question promoters ask most often is: 'I was just working for someone; I did not know what the company was doing. Can I still be implicated?' The answer depends on three variables: subjective knowledge, objective depth of participation, and whether funds were handled. The combination of the three determines the level of liability.

Subjective knowledge cannot be established simply by saying 'I did not know.' In judicial practice, knowledge is often inferred from objective evidence: what training you attended, what materials were posted in group chats, whether the company gave any risk warnings, whether you continued after user complaints, and whether you stopped after regulatory warnings. If the training materials stated 'avoid domestic regulation' or 'use offshore channels,' if the group chats discussed 'this is not compliant in China,' or if you continued recruiting after user complaints, these will all become adverse evidence. Conversely, if the company never disclosed the nature of the business, you were only responsible for forwarding public information, and you proactively stopped and kept records after discovering anomalies, these are favorable evidence.

Objective depth of participation looks at what you actually did. Merely forwarding links is on a completely different scale from participating in pricing, managing a team, handling customer complaints, or handling funds. Managing a team means you are organizing others; handling customer complaints means you are exposed to user fund disputes; handling funds means you have entered the fund chain. The deeper your participation, the harder it is to position yourself as an 'ordinary employee.'

The manner of profit is the variable most easily overlooked. A fixed salary, per-head commissions, and downline performance sharing are assessed differently. A fixed salary indicates that you provide labor services; per-head commissions indicate that your income is directly tied to customer acquisition; downline performance sharing indicates that your income is tied to the business scale of the entire team, bringing you closer to the role of an operator.

Whether funds were handled is the dividing line. Collecting, paying, or exchanging on behalf of others is a clear crossing of the line. If users transfer money to you and you then transfer it to the company or convert it into stablecoins, you are not merely a promoter but a link in the fund chain, and may simultaneously be assessed for illegal business operations, money laundering, and other violations. Merely forwarding links and not touching money is relatively lighter, but it is not risk-free, because 'assisting' may itself be pursued.

A frequent misjudgment should be flagged here: assuming that receiving only a fixed salary and not touching funds means there is no criminal risk. A fixed salary only shows that the manner of profit is relatively lighter; it does not change the fact that you participated in a prohibited business. If you knew the nature of the business and continued to participate, a fixed salary may also be found to constitute joint participation.

Between normal performance of duties and crossing the line, there are several lines you can self-check

The preceding analysis can be condensed into three lines for self-checking, to help promoters determine where they currently stand.

Relevant-provisions line: only brand promotion and forwarding of public information, with no return promises, no collecting funds on behalf of others, and no developing downlines. This line is relatively the lightest, but the premise is that the promotional content itself does not involve return promises or functional packaging, and that you genuinely did not know the business was prohibited. The residual risk is that 'assisting' may still be pursued, albeit at a lower level.

Relevant-provisions line: involving user guidance and registration assistance, company authorization and compliance training records need to be retained. The risk on this line is moderate; the key evidence is whether you can prove you were performing your duties, whether the company provided compliance explanations, and whether you received risk warnings. If the company never disclosed the nature of the business, the finding of your subjective knowledge will be relatively difficult; if the company explicitly stated that it was 'not compliant in China,' your position will be clearly unfavorable.

Relevant regulatory threshold: involvement in tiered commissions, team management and fund pooling is high-risk and should be stopped, with evidence preserved. Once this line is crossed, it becomes very difficult to explain it away by saying 'I was just an employee.' What should be done is to immediately stop recruiting downline members, stop collecting and making payments on behalf of others, and stop promising returns, and to document the stop actions in writing, for example by sending emails or messages stating that you will no longer participate in the relevant business.

It needs to be made clear that these three lines are only self-assessment tools, not a guarantee of exemption from liability. Even if you remain on the relevant regulatory threshold, if the business itself is determined to be illegal financial activity, your participation may still be assessed; only the level of liability differs. Any claim that 'doing this makes you absolutely safe' is not credible.

There is another point that is easily overlooked: the place where the promotional conduct occurs, the location of the servers and the location of the receiving accounts may affect jurisdictional connecting factors. If you are in the mainland, the receiving account is in the mainland and the users are also in the mainland, then the connecting factors for mainland regulatory and judicial authorities are clear, and this cannot be severed by saying 'the company is overseas.'

What can be done now: a self-protection checklist for materials, authority and actions

If you are currently promoting U cards or have done so in the past, you can now prepare materials at three levels and at the same time take several stop actions.

The first level is to organize identity and responsibility materials: employment contracts, authorization documents, job descriptions and remuneration settlement records. These materials are used to prove the boundaries of your responsibilities and to show whether you provided labor services or participated in the business. Note that these materials can explain your role, but cannot change the illegal characterization of the business itself.

The second level is to preserve materials reflecting your state of knowledge: internal communications records, training materials, risk warnings and group chat records. These materials are used to reconstruct what you knew and did not know at the time. If the company never disclosed the nature of the business, these records are favorable to you; if the records show that you knew long ago that the business was prohibited, then do not expect to extricate yourself by relying on these materials, and you should seek professional advice as early as possible.

The third level is to take stop actions and preserve evidence: stop recruiting downline members, stop collecting and making payments on behalf of others, and stop promising returns, and state in writing by email or message that you will no longer participate. The stop actions themselves are both risk management and evidence of subjective knowledge—they show that you chose to withdraw after becoming aware of the problem.

If you have already been interviewed or investigated, the recommended order of response is: first confirm the other party's identity and the subject matter, and then decide the scope of your statement. Do not proactively expand the scope of your statement without preparation, and do not 'take the heat' for the company or your superiors when you do not clearly understand the full picture of the business. Whether and when to retain a lawyer depends on whether you are positioned as a witness or a suspect, and this judgment needs to be made in light of the specific notice documents.

Finally, it must be made clear what these materials cannot resolve. They can help explain your role and knowledge, but cannot turn a prohibited business into a lawful one. If the business is determined to be illegal financial activity, your participation may still be assessed; the role of the materials is to affect the level of liability and the subjective determination, not to provide an exemption from liability.

For persons in charge of companies planning to expand overseas and cross-border groups, the same logic applies to team management: if a company organizes a promotion team in the mainland to sell U cards, the risk lies not only with the promoters but also with the organizers. Compliance review must cover not only the product itself but also promotional scripts, commission structures, fund flows and personnel management.

Verification checklist

  • Confirm your role in the U-card chain: card issuance, settlement, currency exchange, and recruitment. These four roles carry different legal weight.
  • Map out the income structure: distinguish one-off service fees, per-head commissions, and downline performance-based profit sharing.
  • Review promotional language: whether it contains statements such as return promises, deposit-to-earn interest, or referral rebates.
  • Confirm whether you handle funds: collecting, paying, or exchanging on behalf of others clearly crosses the line.
  • Organize identity materials: employment contracts, authorization documents, job descriptions, and remuneration settlement records.
  • Preserve knowledge-related materials: training materials, group chat records, risk disclosures, and complaint-handling records.
  • Stop high-risk actions: recruiting downlines, tiered rebates, collecting and paying on behalf of others, and return promises, and create a written record.
  • When interviewed, first confirm your identity and the subject matter, then decide the scope of your statement, and retain a lawyer where necessary.
  • Enterprises should review their promotion teams: whether scripts, rebate structures, fund flows, and personnel management cross the line.

Reference materials

  1. Notice of the People's Bank of China, the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the State Administration for Market Regulation, the National Financial Regulatory Administration, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange on Further Preventing and Addressing Risks Relating to Virtual Currencies and Other Matters_China Securities Regulatory Commission｜People's Bank of China, National Development and Reform Commission, Ministry of Industry and Information Technology, Ministry of Public Security, State Administration for Market Regulation, National Financial Regulatory Administration, China Securities Regulatory Commission, State Administration of Foreign Exchange (reposted on the CSRC website)｜2026-02-06｜Mainland China｜current｜https://www.csrc.gov.cn/csrc/c100028/c7614318/content.shtml｜Verified on 2026-09-17T16:09:51.148Z
  2. Responses of Relevant Persons in Charge of the People's Bank of China and the China Securities Regulatory Commission to Questions from Journalists on the Notice on Further Preventing and Addressing Risks Relating to Virtual Currencies and Other Matters_China Securities Regulatory Commission｜People's Bank of China, China Securities Regulatory Commission (published on the CSRC website)｜2026-02-06｜Mainland China｜official_disclosure｜https://www.csrc.gov.cn/csrc/c100028/c7614320/content.shtml｜Verified on 2026-09-17T16:09:51.176Z
  3. Notice on Further Preventing and Handling the Risks of Speculation in Virtual Currency Trading_State Council Department Documents_Chinese Government Website | People's Bank of China and nine other departments (published on the Chinese Government Website) | 2021-09-15 | Mainland China | not_effective | https://www.gov.cn/zhengce/zhengceku/2021-10/08/content_5641404.htm | verified on 2026-09-17T16:09:51.272Z
  4. Notice of the People's Bank of China, the National Development and Reform Commission, the Ministry of Industry and Information Technology, the Ministry of Public Security, the State Administration for Market Regulation, the National Financial Regulatory Administration, the China Securities Regulatory Commission and the State Administration of Foreign Exchange on Further Preventing and Handling Risks Relating to Virtual Currency and Other Related Risks (Yin Fa [2026] No. 42) | People's Bank of China and seven other departments (published on the website of the People's Bank of China) | 2026-02-06 | Mainland China | current | https://www.pbc.gov.cn/tiaofasi/144941/3581332/2026020619591971323/index.html | verified on 2026-09-17T16:09:51.389Z
  5. Future financial services regulatory regime for cryptoassets - GOV.UK | HM Treasury (UK Government website GOV.UK) | 2023-02-01 | United Kingdom | official_disclosure | https://www.gov.uk/government/consultations/future-financial-services-regulatory-regime-for-cryptoassets | verified on 2026-09-17T16:09:56.418Z