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Legal Analysis: Airdrop Farming and VPN Use in China – Is it Really Prohibited?

Wednesday Nov 12 2025 05:10

2 min

Table of Contents

1. Legal Analysis: Airdrop Farming and VPN Use in China
1.1 Case Summary
1.2 Is VPN Use Illegal?
1.3 Is Airdrop Farming Illegal?
1.4 Conclusion

Legal Analysis: Airdrop Farming and VPN Use in China

Introduction: I recently received an article from a fellow lawyer discussing the confiscation of 5 million yuan from an airdrop farming workshop. This prompted me to analyze the actual risks associated with this activity, considering my practical experience, understanding of VPNs, and interactions with law enforcement.

Case Summary

According to the article, three individuals were apprehended for airdrop farming, generating profits of 3 million yuan in one year. Although they didn't commit crypto-related criminal offenses, they violated regulations regarding "scientific internet access," leading to the confiscation of 5 million yuan and a 10,000 yuan fine. This discrepancy between profits and fines raises questions about the actual duration of the operation.

Is VPN Use Illegal?

My view differs from the one presented in the article. Merely using a VPN doesn't violate any current Chinese laws or regulations. VPNs use public internet channels, not creating private ones. They simply bypass censorship on specific IP addresses. The crucial issue isn't the VPN usage itself, but the activities performed while using it. Searching for academic papers or following celebrities on social media doesn't constitute a violation. However, engaging in illegal activities using a VPN is a different matter.

Is Airdrop Farming Illegal?

While I've discussed this topic in the past, I reiterate here that airdrop farming isn't inherently illegal. Although some programmers have been penalized for working for foreign companies, these cases often undergo administrative reconsideration. China's regulation of cryptocurrency prohibits platforms (like Binance) from issuing cryptocurrencies but doesn't prohibit users from participating on these platforms. No law specifically forbids airdrop farming. The principle of "what is not prohibited by law is permitted" applies here. However, individuals should exercise caution regarding exploiting promotions from legitimate domestic businesses, as this may lead to charges of theft or unauthorized access to computer systems.

Conclusion

If VPN usage per se and airdrop farming are not illegal, how can the combination of the two be considered illegal? The purpose of this analysis is to offer an alternative perspective to those concerned about these issues. Unjustified administrative penalties can be challenged, and all available avenues for redress should be explored.

Risk Warning: this article represents only the author’s views and is for reference only. It does not constitute investment advice or financial guidance, nor does it represent the stance of the Markets.com platform.When considering shares, indices, forex (foreign exchange) and commodities for trading and price predictions, remember that trading CFDs involves a significant degree of risk and could result in capital loss.Past performance is not indicative of any future results. This information is provided for informative purposes only and should not be construed to be investment advice. Trading cryptocurrency CFDs and spread bets is restricted for all UK retail clients. 

Written by:

Liam James

Legal Analysis: Airdrop Farming and VPN Use in China – Is it Really Prohibited?

Legal Analysis: Airdrop Farming and VPN Use in China

Case Summary

Is VPN Use Illegal?

Is Airdrop Farming Illegal?

Conclusion

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