Shanghai Court Declares Cryptocurrency Legal Property in China
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Judge Sun Jie of the People’s Court of Songjiang District in Shanghai clarified that cryptocurrency is considered a legal commodity with property rights in China. This opinion came from a 2017 business dispute, where a company failed to issue a token as promised, leading to a partial refund. Judge Sun confirmed that individuals can legally own virtual currencies, but commercial entities are prohibited from investing in or issuing tokens.
Recently there were rumors that China will lift its crypto ban and this judgment hints that things will change soon in China.
Let’s hop in to know what it means!
Judge Weighs In: Crypto is Legal to Own
Judge Sun highlighted that while individuals can legally own virtual currencies, commercial entities are barred from engaging in virtual currency investments or issuing tokens independently. She warned about the risks associated with cryptocurrency, including market speculation, potential financial disruptions, and its misuse in illegal activities like money laundering and fraud. Despite China’s stringent restrictions on crypto exchanges and transactions since 2017, the ownership of digital assets has never been prohibited, maintaining its status as a lawful personal asset under Chinese law.
Despite the legal clarity on ownership, China’s crypto regulations remain contradictory. A recent bribery case involving Yao Qian, a former director at the People’s Bank of China’s digital currency institute, highlights these complexities. While individual ownership is allowed, China has kept strict regulations in place, with no signs of easing restrictions on the crypto industry.
Crypto Reaction
Experts like Zhu Guangyao, former vice minister of finance, stress that cryptocurrency is vital for the digital economy and that China must adapt to stay competitive, especially as the U.S. plans to use Bitcoin as part of its strategic reserves under President-elect Donald Trump. Meanwhile, Bitcoin has recently surged to a record high of $94,730, showcasing the growing global influence of cryptocurrency.
In short, China’s stance on cryptocurrency is a delicate balance between protecting individual ownership rights and maintaining strict commercial restrictions.
