China’s Cryptocurrency Verdict: Legal Property Or Trouble Ahead?

Cryptocurrency has long been a contentious subject in China, with the government imposing strict regulations and outright bans on various aspects of the industry. However, a recent report from China’s People’s Court challenges this historical stance, offering newfound recognition to virtual assets as legal property.

In a significant departure from conventional policy, the report titled “Identification of the Property Attributes of Virtual Currency and Disposal of Property Involved in the Case” asserts that virtual assets possess economic attributes that categorize them as property.

This revelation cited in a report from a local publication is a remarkable departure from China’s blanket ban on foreign digital assets, asserting that individual-held virtual assets should enjoy legal protection under current policy frameworks.

China's People's Court. Source: China Daily

This isn’t the first instance of a Chinese court contesting government crypto policies. In 2018, a Hangzhou case marked a pivotal moment when a Chinese court recognized Bitcoin as “virtual property.”

Despite the illegality of trading and mining Bitcoin at the time, the court justified its decision based on Bitcoin’s intrinsic attributes of value, scarcity, and responsibility. It remains uncertain whether this precedent influenced the recent court ruling.

China’s Complex Relationship With Cryptocurrency

China’s historical stance on cryptocurrencies has been characterized by a series of stringent measures. The government prohibited banks from engaging in Bitcoin transactions in 2013, followed by the crackdown on initial coin offerings (ICOs) in 2017.

Subsequently, authorities targeted Bitcoin mining operations in 2019, culminating in a comprehensive ban on cryptocurrency trading and mining in 2021. These actions underscored the Chinese Communist Party’s unwavering efforts to control and restrict crypto adoption within the nation.

This recent legal shift raises intriguing questions about C

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Author: Christian Encila

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