The Hubei court in China sentenced the defendant in a virtual currency theft case using backdoor code to fraud, involving approximately 77.76 million yuan.

BlockBeats News, July 25th. He and others used a "backdoor" to manipulate platform data, swapping and transferring the virtual currency pledged by investors on the platform. In just two months, 103 investors lost virtual currency worth approximately RMB 77.76 million.

Following the public prosecution by the Yunmeng County Prosecutor's Office in Hubei Province, China, in March of this year, the first-instance court sentenced He and 4 others to fixed-term imprisonment ranging from three to thirteen years for fraud, and imposed fines ranging from 20,000 to 300,000 RMB. He appealed the first-instance judgment. Recently, the second-instance court ruled to reject the appeal and uphold the original judgment.

In August 2017, He and Jia (dealt with separately) established a technology company. In July 2020, He and Jia independently designed and hired Du to develop a decentralized cryptocurrency exchange platform (a platform where users can conduct cryptocurrency transactions without intermediaries). To gain investors' trust, in September of the same year, He hired a professional project security assessment company to conduct a security audit of the platform and issued the accompanying "D Coin."

However, after the security audit was passed, He and others launched another set of platform code with a "backdoor" function that had not passed the security audit. Through the "backdoor," He and others could arbitrarily modify the price of "D Coin" on the platform and without user consent, exchange "D Coin" with the virtual currency invested by users.

From October to November 2020, He and Jia instructed Du, Ling, and others to use the "backdoor" function in the early morning to increase the price of the platform's "D Coin" by tens of times, and then used their large holdings of "D Coin" to exchange with the virtual currency invested by users on the platform. After the exchange was completed, this virtual currency was transferred to He's account. After the operation was completed, He and others lowered the price of "D Coin" again, while users were unable to withdraw their virtual currency due to being trapped, suffering huge losses. After appraisal, a total of 103 victims suffered losses due to the operations of He and others, with the virtual currency defrauded amounting to a total of over 77.76 million RMB.

On September 6, 2024, the Yunmeng County Prosecutor's Office filed charges of fraud against He, Du, Li, and Ling. On March 21 of this year, the court adopted all the criminal facts and sentencing recommendations charged by the prosecutor's office and made the above judgment according to the law. After the first-instance judgment, He appealed. Recently, the second-instance court ruled to reject the appeal and uphold the original judgment. (China Youth Daily)