Potential Risks of Web3 Project Operations: Common but Dangerous Patterns

In the Web3 space, many projects adopt operational models that seem compliant but are actually high-risk. These models often attempt to reduce regulatory traceability by obscuring responsibility boundaries, but from a regulatory perspective, these are precisely the areas that are most likely to provoke issues.

"Outsourcing" is difficult to evade operational responsibility

Some Web3 projects tend to outsource core functions such as contract development, front-end maintenance, and marketing to third parties, hoping to weaken their own operational attributes. However, regulators are concerned with the actual decision-makers and beneficiaries, rather than the superficial contractual relationships. If it is found that the so-called third-party service providers have interests related to the project team, directive control, or personnel overlap, even with independent contracts, they may be regarded as an extended operating unit of the project party.

For example, in the case where the U.S. Securities and Exchange Commission (SEC) sued a blockchain project, although the project established multiple legal entities and outsourced some work, the SEC's investigation revealed that all key decisions were still controlled by the parent company, thus the outsourcing structure did not constitute effective liability separation.

The Hong Kong Securities and Futures Commission has also made it clear in handling compliance investigations of virtual asset service providers that if core operational and technical decisions are still controlled by the same actual controller, even if the business is executed by a "service provider," it will not be regarded as an independent operation. This kind of "formal separation" may instead be seen as evidence of deliberately evading regulatory obligations.

"Multiple Registrations + Distributed Nodes" Hard to Conceal the Control Center

Some projects choose to establish companies in countries with relatively loose regulations while claiming global node deployment, attempting to create the impression of "decentralization." However, in reality, most of these structures still exhibit highly centralized control, with decision-making power, fund flow, and key code update permissions often concentrated in the hands of a few individuals.

Regulatory authorities will prioritize tracing the "actual controller's location" and the "key activity location" to establish jurisdiction when facing legal disputes or cross-border investigations. Distributed nodes are merely a technical deployment method and cannot obscure the substance of operations.

For example, in a case involving a well-known trading platform, a U.S. court ruled that as long as U.S. users purchase cryptocurrency tokens through the platform and the infrastructure of the trading system is located in the U.S., U.S. law is applicable, even if the platform claims to have no U.S. entity.

The Monetary Authority of Singapore (MAS) and the Hong Kong Securities and Futures Commission are also strengthening regulations on virtual asset service providers, requiring the disclosure of "actual place of management" and "the actual residence of key management personnel," emphasizing that overseas registered structures cannot prevent local regulatory authority from tracing back to the controllers.

"On-chain release" does not equal "no operation"

Some technical teams believe that once a smart contract is deployed, the project is decoupled from it, attempting to achieve a legal separation of responsibilities through technology. However, regulatory agencies do not accept this argument of "technology as immunity." On-chain is merely a formality; off-chain is where the actions occur. Who initiates marketing, organizes investments, and controls circulation paths—these factors are the core of regulatory judgment regarding responsibility attribution.

Even if the project claims that "on-chain contracts are public," if it is still engaging in marketing activities, setting trading incentives, maintaining official communities, or collaborating with opinion leaders, its operational identity cannot be erased.

The U.S. SEC reiterated that even "entertainment-type" tokens need to be assessed according to relevant tests if there is an expectation of wealth appreciation or marketing intervention. The global regulatory trend also indicates that off-chain promotion and distribution channels have become key areas of scrutiny, especially the "incentivized issuance" model conducted through opinion leaders, airdrops, and exchange listings, which are almost entirely regarded as typical operational behaviors.

Conclusion

The logic of regulatory agencies is becoming increasingly clear: it is not about the structures that projects have built, but rather about the actual operations and beneficiaries. What Web3 projects truly need is clear responsibilities and control boundaries, rather than using complex structures to obscure risks. Establishing a resilient and explainable compliance framework is an effective way to reduce legal risks.