Potential Compliance Traps in Web3 Project Operations

In the Web3 space, many projects adopt seemingly clever operational strategies to avoid regulatory risks, but these can actually lead to greater risks. This article will explore three common yet potentially dangerous operational models and analyze the associated legal risks.

The Responsibility Dilemma of Outsourcing Services

Some Web3 projects tend to outsource core business functions to third parties, attempting to downplay their 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 a vested interest or control relationship with the project team, regulators may view them as an extended operational unit of the project.

A typical case is a blockchain project sued by the U.S. Securities and Exchange Commission (SEC) in 2022. Although the project established multiple legal entities and outsourced part of its operations, the SEC's investigation revealed that key decisions were still controlled by the parent company, and therefore the outsourcing structure failed to effectively isolate liability.

A truly effective compliance strategy should clearly delineate at the early stage of the project which functions can be outsourced and which must be internally undertaken, along with the disclosure of the responsible parties.

Regulatory Challenges of Multi-Location Registration and Distributed Nodes

Some projects choose to register their companies in countries with relatively loose regulations while claiming to deploy nodes globally, attempting to create an image of "decentralization". However, this approach often struggles to withstand in-depth regulatory investigations. Regulatory agencies are more concerned with the location of actual controllers and key activities rather than the apparent registered location and node distribution.

A legal case from 2024 shows that as long as there are users in the U.S. using a platform or infrastructure located in the U.S., U.S. law may apply, even if the platform claims there are no U.S. entities. This indicates that regulators do not recognize claims of "statelessness"; as long as there is a connection between users and technology, liability may be traced back.

Compared to building complex shell structures, clarifying the responsibilities of actual project controllers and the distribution of regulatory obligations may be more beneficial in reducing legal risks.

On-chain publishing does not equal no operation

Some technical teams mistakenly believe that once a smart contract is deployed, it is disconnected from the project, considering it as "decentralized delivery." However, regulators do not accept the view of "technology as exemption." They are more concerned with off-chain behaviors, such as marketing, placement, and circulation path control, as these are the core factors for determining liability.

Recent legal cases indicate that even if a project claims "on-chain contract disclosure," the presence of off-chain marketing activities and KOL promotions may still be considered core operational activities. Regulatory agencies in multiple regions have strengthened the "behavior-oriented" judgment logic, listing off-chain promotion and distribution channels as key review items.

On-chain deployment is not the end of responsibility, but the starting point. As long as the project side continues to promote token circulation through off-chain activities, it will always be within the regulatory view. True decentralization is not just about the technical form, but whether it can exit operations, relinquish control, and allow the market to develop on its own.

Conclusion

In recent years, the regulatory logic has become increasingly clear: the focus is not on what structure a project has built, but on how it operates in practice and who the beneficiaries are. What Web3 projects truly need is a clear definition of responsibilities and control boundaries, rather than complex structural stacking. Establishing a resilient and interpretable Compliance framework is wiser than attempting to obscure risks through "structural games."