Recently, I came across a quite interesting case—a college student born after 2000 was convicted of fraud for issuing Tugou Coin, which sparked quite a bit of controversy. To be honest, such incidents are not uncommon in the crypto world, but this case definitely warrants a detailed analysis because it involves a core issue: does issuing Tugou Coin constitute a crime?

First, let's talk about the background. In May 2022, a student named Yang Moumou noticed that an overseas DAO was planning to issue tokens. He then issued a token on the public chain called Tugou Coin BFF, with the same name. As a liquidity provider, he injected 300,000 USDT and 630,000 BFF tokens, then withdrew his funds within ten minutes. This operation caused another investor, Luo, who had bought BFF, to see its value plummet instantly—from a worth of 50,000 USDT down to just 21.6 USDT. Luo subsequently reported the case, accusing Yang Moumou of defrauding him of over 300,000 yuan.

The current question is: does Yang Moumou's behavior count as fraud? The prosecution's logic is straightforward: he issued fake BFF tokens, used liquidity as bait to lure people in, then quickly withdrew the funds. From this perspective, it indeed looks like fraud. But if you have a deeper understanding of how the crypto scene works, things are not that simple.

I noticed a key detail: Luo bought BFF at the exact same second Yang added liquidity. It’s practically impossible for an ordinary person to complete such an operation within a second, let alone precisely at the moment the project team added liquidity. This strongly suggests the involvement of automated trading programs. According to Luo’s trading records, he has a lot of transactions involving Tugou Coin, with multiple buy and sell trades completed within seconds or a few dozen seconds—this looks more like professional traders or "snipers" operating in the scene.

In other words, Luo might not have been scammed at all. He didn’t enter because he believed in something; rather, he was engaging in a form of capital game—what’s called "Tugou-pumping" in the crypto community. He used automated tools to jump in quickly, hoping to arbitrage profit. But this time, he didn’t get the profit, only losses. This is a form of high-risk investment, not fraud.

From a legal perspective, fraud requires three elements: the suspect’s intent to illegally possess others’ property, the act of deception (falsifying facts or concealing the truth), and the victim’s resulting mistaken belief leading to financial loss. In this case, the third element is probably not satisfied. Luo was not misled by Yang’s actions; he simply experienced a failed trade.

However, I must clarify that although Yang’s behavior might not constitute fraud, issuing Tugou Coin itself remains a high-risk activity. Under current regulatory conditions, issuing Tugou Coin could very well constitute illegal business operations, illegal fundraising, or even gambling crimes. Especially illegal fundraising—if the project team is based domestically, even if the coin is issued overseas, it could still violate laws against illegal public deposit absorption. Therefore, for those wanting to stir up trouble in the crypto scene, this is a red line they must be wary of.