Is crypto copy trading a shortcut to riches or a hidden trap?

Here’s the reality: For people with Mainland China identity, operating fully legally in the crypto space is almost impossible—difficulty level five stars. Some claim that getting a foreign passport solves everything? Forget it, that’s just marketing talk. In fact, as long as you live abroad for more than 183 days and leave real traces of life, a passport isn’t really required.

If you quietly trade for yourself and bear your own profits and losses, this low-key approach is relatively controllable in terms of risk. But once you get involved in copy trading—especially in private channels, exposing your real name and contact details—the situation changes. When there’s profit, everyone is happy, but once there’s a drawdown, followers can report you for fraud or illegal fundraising at any time. I’ve seen a lot of cases like this: some were convicted of illegal business operations, some crossed the line into illegal fundraising, and others got investigated for using unauthorized overseas network tools. That’s why many copy traders ultimately choose private settlements or simply operate anonymously—if they lose, they just swallow the losses themselves.

Now, some top exchanges have launched mirror trading and copy trading features, which on the surface don’t involve fund custody, and traders can’t directly control followers’ accounts. But in essence, this is still executing buy/sell orders on behalf of others. From a global regulatory perspective, this falls under non-custodial asset management services. However, since it’s an official platform feature and users opt in themselves, it’s less controversial.

For Mainland users: independent trading or anonymous copy trading, combined with strict OTC deposit and withdrawal controls, can basically avoid most trouble. But if you want to run a compliant copy trading business in private channels and avoid legal disputes after losses, you have to go through the proper procedures—which aren’t as costly as you might think. Don’t try to cut corners and end up losing everything.

The waters of crypto copy trading run much deeper than you think. One wrong step and you could lose everything.