Bitcoin Protected Under Chinese Law, Says China High Court

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Bitcoin Protected Under Chinese Law, Says China High Court
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A new ruling by China’s Shanghai High People’s Court has added a new twist to its view of cryptocurrencies after declaring bitcoin a virtual asset protected by Chinese law.

The court also held that Bitcoin has economic value. “In the actual trial practice, the people’s court has formed a unified opinion on the legal status of bitcoin, identifying it as virtual property,” it said on its official WeChat channel.

As early as October 2020, Cheng asked Shi to repay a loan of one (1) bitcoin, which X claimed belonged to him. Defendant XX refused to return the bitcoin and transferred the case to the District People’s Court. Since the mediation in May 2021, the parties have agreed that the defendants will provide compensation at a discount to the value of bitcoin at the time of the loan.

The case was eventually transferred to the Shanghai Higher People’s Court. The Supreme People’s Court is the highest people’s court of every state in China.

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China’s new crypto precedent?

This latest ruling could set a new precedent for how Chinese law views virtual assets.

Historically, the Chinese government has discouraged cryptocurrency trading, eschewing miners to reduce energy consumption. Last year, China completely banned all crypto trading and mining within its borders.

“Business activities related to virtual currencies are illegal financial activities,” the People’s Bank of China said last September. It also warned Chinese citizens that crypto trading could “severely endanger people’s assets.”

China’s Higher People’s Court is the highest local court in each province in China, and it consists of the former People’s Court and Intermediate People’s Court. Similar to the structure of the Supreme People’s Court, the High Court is also directly controlled by the central government.

Digital Yuan Expands to Transmission Networks

China has since taken a step forward in introducing a central bank digital currency (CBDC) with a digital yuan. The use of the digital yuan has surged since its launch, with Xiamen and Guangzhou becoming the latest cities to incorporate the currency into transportation.

The People’s Bank of China announced the expansion of the CBDC pilot program to 11 new cities, bringing the total number of cities under the program to 23.

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