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Wednesday, September 28, 2022

Court In China Designates Bitcoin To Be Virtual Property

The expulsion of cryptocurrency traders and other legal rulings by China has in effect virtually stopped the trading of cryptocurrencies and allied operations within China. But the recent judgment pronounced by a Shanghai Court has found that Bitcoin is a virtual asset.

The Shanghai High People’s Court ruled that Bitcoin had economic value and was protected by the nation’s laws. This judgment was about a suit filed in the district court back in October 2020 that involved the retrieval of the loan of 1 Bitcoin. It is expected to provide a sense of relief among advocates of cryptocurrency in China.

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A report by a Chinese news agency, Sina, said that the Shanghai Court declared the statement on the official channel, WeChat. It confirmed that Bitcoin would be regarded as a virtual property under Chinese laws. The court noted that China’s People’s Court had arrived at a unified judgment on the lawful opinion on Bitcoin and has identified it to be a virtual possession.

China Court Ruling On Bitcoin A Precedence For Other National Courts

The court said that BTC had intrinsic economic worth and confirmed the attributes of the property. Thus, the legal guidelines that are applicable for property rights also apply here for protection.

Significantly, the High People’s Court is the highest of the municipal courts. Preceding it is the people’s and the intermediate people’s court. They are all under the direct control of the government at the center. They have a hierarchical structure similar to China’s highest court, the Supreme People’s Court.

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The judicial pronouncement involves a case that involved an individual filing a case against another individual demanding the return of 1 BTC. As the defendant did not possess the Bitcoin, both the parties settled for compensation at a rate agreed upon mutually.

The ruling is significant as it indicates the establishment of a precedent in the way virtual assets could be seen under Chinese laws. 

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