Legal Dilemmas and Solutions for Web3 Practitioners

People working in the Web3 field are often passionate about this opportunity-filled industry. Compared to traditional industries, Web3 positions usually offer higher salaries and more flexible working arrangements, which are very attractive to many. However, along with these advantages come some significant risks and uncertainties that cannot be ignored.

Many Web3 practitioners have doubts about the legality of their work. They may consult relevant laws and regulations but find that there is no explicit prohibition against the work they are engaged in. This gray area leaves many feeling confused: if there is no clear law prohibiting it, why is there still a legal risk?

In fact, there is a certain misunderstanding in this recognition. The stability of the law often leads to a lag in addressing emerging social issues. Taking the digital collectibles (NFT) industry as an example, although it has developed for many years, there are still no clear legal regulations to date. However, this does not mean that relevant activities are necessarily free of legal risks.

When assessing whether Web3-related businesses involve criminal risks, judicial authorities often look beyond the surface to the essence. For example, the perpetual contract business of certain exchanges has been classified as gambling, primarily because their business model increases the speculative nature of trading, which is essentially similar to gambling behavior. This indicates that even similar businesses may face different legal risks due to variations in specific operational methods.

For Web3 practitioners, it is important to remain rational and not adopt an ostrich mentality. When consulting a lawyer, one should focus on understanding the criminal risk boundaries that their actions may involve, as well as which behaviors carry relatively high risks in judicial practice. This way, more informed decisions can be made.

It is important to emphasize that not all Web3 projects carry legal risks. Some businesses do exist in a gray area of the law, and everyone's tolerance for risk varies. Practitioners should have a thorough understanding of the relevant legal risks and their boundaries, foresee the possible worst outcomes, and then make the most suitable decisions for themselves. Only in this way can one avoid potential regrets and remorse in the future.