Author: Lawyer Liu Zhengyao

introduction

Today, a friend forwarded me an article by fellow lawyer Zhang Suhang titled "Airdrop-Fighting Studio Busted! 5 Million Yuan in Illegal Gains Confiscated!" They wanted me to analyze whether airdrop-fighting is really that risky. After carefully reading Lawyer Zhang's article, I felt it necessary, as a fellow cryptocurrency lawyer, to combine my own practical experience, understanding of circumventing internet censorship (i.e., "scientific internet access") and airdrop-fighting, as well as my long-term experience dealing with public security organs, to write an article analyzing this matter.

I. Case Overview

According to Attorney Zhang's article, he recently handled a case involving three individuals who had their studio "forced" to embezzle 3 million yuan in a year. In legal terms, "forced" usually means "forced into a criminal activity," implying involvement in criminal charges. However, Attorney Zhang's article states that his clients were not involved in any criminal offenses related to virtual currency, but they violated relevant laws regarding "scientific internet access." Therefore, they were fined 5 million yuan in illegal gains, had their mobile phones and computers confiscated, and were fined 10,000 yuan.

Here's a small question: if someone amassed 3 million in a year, why was 5 million confiscated? Attorney Liu speculates that they might have been accumulating funds for over a year. However, Attorney Zhang didn't specify, so we shouldn't speculate. Let's assume for now that the client amassed a total of 5 million through airdrops.

II. Is circumventing the Great Firewall illegal? Wrong!

According to Attorney Zhang, using a VPN to bypass internet censorship constitutes an administrative violation. The public security authorities can impose a fine of up to 15,000 yuan on the individual and confiscate any illegal gains (if any). This is based on Article 6 of the "Interim Provisions on the Administration of International Connections of Computer Information Networks": "Computer information networks directly connecting to international networks must use the international access channels provided by the Ministry of Posts and Telecommunications' national public telecommunications network. No unit or individual may establish or use other channels for international connections."

My view is completely opposite to Attorney Zhang's. Simply using a VPN to bypass internet censorship does not violate any current laws, regulations, departmental rules, or other normative documents in my country. Using a VPN does not mean establishing your own international internet connection; even when using a VPN, you are using international access channels provided by the national public telecommunications network (such as those provided by the three major domestic telecom operators). In essence, a VPN only circumvents the Great Firewall's blocking of certain overseas IPs (such as Google websites). For detailed technical and legal explanations, please refer to my articles from several years ago, "Are there any legal risks in using VPNs and other tools to bypass internet censorship?" and "Does 'Browsing the Great Firewall' constitute a crime?".

The key issue here isn't whether or not a VPN was used; no one has the right to say that using a VPN is illegal. The crucial point is what was done after using the VPN. If you used it to search academic papers on Google or follow celebrities on Instagram, a law-abiding police officer certainly wouldn't say you're breaking the law. However, if you used a VPN to perform the following actions, that's a different story (excerpt from the Cybersecurity Law).

So, the core question is: Is it illegal to loot airdrops? If it is illegal, then it seems reasonable for the police to confiscate the money; if it is not illegal, the police cannot simply confiscate the money earned from looting airdrops based on the so-called "illegal use of VPN".

3. Is it illegal to collect airdrops?

I've actually discussed the act of looting airdrops in many of my previous videos. I won't go into a lengthy analysis here, but my conclusion is that looting airdrops is not illegal.

Previously, a programmer in Chengde was fined over 1 million yuan and had his income confiscated for writing code for an overseas company using a VPN. However, the programmer appealed the decision, and the outcome is unknown (anyone with details can contact Attorney Liu). At the time, I also wrote an article analyzing this, titled "Programmer's Business Income Confiscated for 'VPN': Is 'Scientific Internet Access' Really Safe?" Another case was "Using VPN Tools to Invest in Cryptocurrency Leads to Arrest: Is Cryptocurrency Trading Illegal?", but it didn't mention the specific administrative penalty. In both articles, I stated my opinion: writing code for overseas companies is not illegal, nor is cryptocurrency trading.

Taking airdrops as an example, such as the recently popular Binance Alpha, one common method is to use multiple accounts to exploit them, or to use cheats to "millisecond-level" exploitation. However, whether it's a foreign cryptocurrency exchange like Binance, or other decentralized exchanges, wallets, or public blockchains, as long as these platforms issue virtual currencies, according to regulatory documents in mainland China such as the "9.4 Announcement" in 2017 and the "9.24 Notice" in 2021, they all constitute "illegal financial activities." However, this only applies to the platform; users of the platform are not subject to any legal consequences.

Based on my country's regulatory documents and other laws and regulations regarding virtual currencies, it cannot be concluded that "airdrop exploitation is illegal." If someone believes it's illegal, they can point out which specific laws or regulations are violated; otherwise, it's considered permissible unless prohibited by law. Of course, if it's a compliant domestic company conducting legitimate business protected by law, then please do not attempt to exploit airdrops. Currently, there are cases where individuals have been convicted of theft or illegally obtaining computer information system data for using technical means to exploit airdrops on platforms like Lalamove and KFC.

Therefore, my personal opinion is: since bypassing the Great Firewall is not illegal, and neither is looting airdrops, then why can we say that bypassing the Great Firewall to loot airdrops is illegal?

I'm not writing this to question Attorney Zhang, but to offer a different perspective to those like my friend who are filled with anxiety about this issue. Wrongful convictions can occur in criminal cases, let alone wrongful administrative penalties. Therefore, if Attorney Zhang's client was indeed fined 5 million yuan, there are many other avenues of redress that can be explored to recover their losses. Given the Ministry of Public Security's explicit ban on deep-sea fishing, I believe there are few who would dare to disregard the consequences and break the law in handling cases.