On the road to cashing out U, the worst fear is not market fluctuations, but the sudden freezing of the bank card followed by that police phone call.
On the day of the mortgage deduction, I stared blankly at the mobile banking interface—$8000 in exchange funds that had just arrived the night before, but the card couldn't be used for transactions. Worse, the next day I received a call from the public security bureau, and the first question was, "Do you know why we are looking for you?"
My palms were all sweaty while holding my phone.
After enduring the unfreezing period myself and helping two friends handle similar situations, I realized one principle: a frozen card itself is not scary; what’s scary is saying the wrong thing when being questioned due to nervousness. The response strategies to the three key questions I shared today are based on personal trial and error, and I hope they can help you.
01 Where is the legal red line for virtual currency transactions?
"Isn't virtual currency trading illegal? Don't you know?"
When the police ask like this, don’t rush to admit guilt. My most recommended response is:
"I have understood the relevant legal policies and know that transactions involving the purchase and sale of Tether between individuals are not legally protected, but 'not protected' and 'illegal' are two different matters. I am just reasonably managing my digital assets and have not participated in any other illegal activities."
The key here is to distinguish between two concepts: according to (Notice on Further Preventing and Dealing with Risks of Speculation in Virtual Currency Transactions), virtual currency-related business activities belong to illegal financial activities, but it also clearly states that "participating in virtual currency investment trading activities involves legal risks," and related civil legal actions are invalid, and losses arising therefrom are to be borne by oneself.
This means that virtual currency transactions between individuals are indeed not legally protected, but it does not directly equate to all participants facing administrative or criminal punishment in all cases.
You should show some understanding of the law, but maintain a non-confrontational attitude. I calmly stated: "I have checked the relevant interpretations from the Supreme Court, and normal virtual currency transactions between individuals are not legally protected, but I believe my actions are a reasonable management of personal assets." This response respects law enforcement while maintaining my bottom line.
02 Skills for negotiating compensation related to involved funds
"You received the funds involved in the case, and you must return 30,000 to unfreeze!"
This is the most common pressure tactic. Don't be intimidated into agreeing immediately; leaving some room is safer:
"I will definitely cooperate with the investigation, but how much I should return should depend on my actual level of involvement in the case, right? Can we check the transaction records together and negotiate a reasonable compensation ratio? As long as the plan is reasonable, I’m willing to cooperate to resolve it."
Such a response expresses a cooperative attitude while avoiding blindly becoming a "big loser."
I once encountered such a situation, at that time I requested to see evidence of the flow of funds and suggested: "If it is indeed proven that the funds I received are related to a fraud case, I am willing to bear part of the responsibility within a reasonable range but need to determine the proportion based on the actual transaction amount."
In the end, the issue was resolved through negotiation, without accepting the initially high compensation demand.
The key point is: do not easily promise a specific amount, but instead request to participate in the assessment process. The involved funds do need to be refunded, but the amount should be based on the actual level of involvement rather than unilaterally claimed by the other party.
03 The process of unfreezing and the myth of criminal records
"If you don't cooperate, we will freeze all your cards and leave a criminal record!"
Don't be scared by the "criminal record". This is how I responded:
"I have already organized all transaction records and transfer proofs, and I can submit them at any time. Currently, the card freeze is only in the investigation stage; there is no conviction, so how could there be a criminal record? Moreover, if my card has not directly received fraudulent funds, but is only indirectly related, it shouldn’t generally affect the use of other bank cards, right?"
Based on my experience, frozen cards caused solely by virtual currency transactions mostly will not directly lead to a 'criminal record'—i.e., a criminal record. Unless it involves clearly illegal activities, such as money laundering and fraud, it is usually just a temporary protective measure.
The actual unfreezing process usually includes: contacting the bank to understand the reason for the freeze, cooperating with public security investigations, providing transaction vouchers and other evidence materials. As long as it can be proven that the transaction itself does not have criminal intent, the chances of unfreezing are high.
My own card was unfrozen two weeks after cooperating with the investigation, and two friends had similar situations. One of them had to wait for the case progress because the counterparty was indeed involved in fraud, which took about a month.
04 Prevention is better than remedy
Post-incident remedies are never as good as pre-incident prevention. Now, before each transaction, I require the other party to provide account statements from the past three months to confirm that the funds are normal business transactions rather than suspicious funds.
At the same time, avoid receiving large transfers from unfamiliar personal accounts, especially those with a short account history or abnormal transaction patterns.
Last time, a friend overlooked this step, resulting in receiving a fraudulent fund transfer, and it took him an extra two weeks to solve the problem.
Exchanging U for cash seeks stability; don’t find the pre-check troublesome—skipping this step might require you to spend several times more effort to fix problems later.
The wave of bank card freezing is, to some extent, a rite of passage for people in the crypto space. It teaches you not just how to communicate with law enforcement but also the survival wisdom of walking safely in the crypto world.
In the current regulatory environment, there exists a gray area between "not illegal" and "protected." Learning how to protect oneself within it is a required course for everyone in the crypto space.
Have you ever experienced a similar frozen card incident? Feel free to share your story—we seek certainty in uncertain environments together.
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