Legal Risks and Coping Strategies for Web3 Practitioners

Recently, a cross-province arrest case involving technical personnel from a digital wallet company has attracted widespread attention in the industry. The technical staff involved in the case were taken away for investigation by local police without any warning, on the grounds that some partner merchants of their platform were suspected of operating online casinos. The employee, as a technical backend maintenance personnel, was accused of "aiding and abetting information network criminal activities."

This event exposed the common legal awareness blind spots among practitioners in the Web3 industry. This article will analyze the main legal risks faced by current Web3 technology positions from three aspects and provide practical suggestions.

Legal Risks of Technical Positions

Many technicians believe that they only provide code on demand, and how it is used is the client's responsibility. However, this viewpoint stems from a misunderstanding of the principle of "technological neutrality." In the current judicial practice in our country, the key to determining whether a crime has been committed lies in whether the provided "technical service" has played a "substantial role" in assisting upstream criminal activities.

If technology objectively lowers the threshold for criminal activities, such as providing anonymous transfers, mixing functions, and means to evade KYC, it will no longer be regarded as "neutral" but rather as "facilitating".

Risk Exposure of Small Platform Employees

Compared to large virtual asset trading platforms, small Web3 projects that lack comprehensive compliance mechanisms are more likely to become the focus of law enforcement agencies. The reasons include:

1. Small platforms often have personnel located domestically, making investigations relatively easier;
2. Small platforms often lack compliance measures such as KYC real-name authentication and AML anti-money laundering.
3. Small platforms usually have deficiencies in compliance capability and response mechanisms.

It is worth noting that while the recent regulations aim to protect the private economy, these protections mainly target compliant operating entities. For cryptocurrency-related projects that are in a legal gray area, their space for seeking policy exemptions or protecting their rights is quite limited due to the lack of compliance endorsement.

Potential Risks of Remote High-Paying Jobs

Many technicians are attracted by the "remote work + high salary" model, but often overlook the legal risks hidden within. High-risk signals include:

• The project's registration location is unclear, and salaries are paid in virtual currency.
• Lack of formal labor contracts, with work arrangements only made through instant messaging tools;
• The project lacks compliance audits, KYC processes, or anti-money laundering systems.

Self-Protection Strategies for Web3 Technicians

To protect themselves in the Web3 field where legal regulations are still unclear, technicians should:

1. Conduct due diligence before joining the project, paying attention to the project's registration location, audit status, compliance systems, etc.
2. Avoid participating in the development of high-risk functional modules, such as mixing coins, anonymous transfers, etc.
3. Keep communication records with the project party as possible evidence for self-verification.
4. Clearly stipulate in the technical cooperation agreement that there will be no direct contact with user funds and no handling of sensitive information, etc.
5. If you have any questions, consult a professional lawyer in a timely manner for a "project compliance check."

Conclusion

Web3 practitioners need to recognize that when law enforcement evaluates the boundaries between technology and law, they often consider the practical uses of technological tools and their social impacts. Establishing a basic awareness of legal risks and a compliance prevention mindset is crucial for robust development in this emerging field.