Bitcoin has been declared a virtual asset protected by Chinese law by the Shanghai High People’s Court. The cryptocurrency has economic value, according to the court.
In China, Bitcoin Is Considered Property
Despite China’s ban on cryptocurrency trading, the Shanghai High People’s Court has ruled that bitcoin qualifies as a virtual asset protected by Chinese law. Last week, the court’s official Wechat channel issued a notice that stated:
The People’s Court has reached a decision on the legal standing of bitcoin and has classified it as virtual property.
The court went on to say that because bitcoin “has a specific economic worth and conforms to the property’s qualities, property rights legal rules are applied for protection.”
The announcement is the first time a Chinese higher court has issued a decision in a bitcoin case.
China’s Case Bitcoin
Cheng Mou filed a lawsuit with the Shanghai Baoshan District People’s Court on October 10, 2020, demanding that Mr. Shi Moumou restore one of his bitcoins, according to the court statement.
Following the trial, on February 23, 2021, the court ordered Shi to pay Cheng BTC within 10 days of the verdict. Shi, on the other hand, refused to pay it. Cheng turned to the local court system for help because of these circumstances. Following that, the Baoshan Court called for a mediation between the two parties.
According to Liu Yang of Beijing’s Deheng Law Firm, the high court’s declaration will serve as a significant reference point for rulings on civil issues involving bitcoin in the Shanghai area.
China has a reputation for being unfriendly to cryptocurrency. However, Bitcoin is a digital asset that receives legal protection in the Cheng Mou case.
The government removed Bitcoin miners operating in several provinces in 2021. Miners were compelled to seek safety in Kazakhstan and the United States.
China’s History With Bitcoin
Bitcoin is a cryptocurrency or virtual currency, that is supposed to operate as money and a form of payment while being independent of any single person, group, or entity, eliminating the need for third-party involvement in financial transactions.
Satoshi Nakamoto, an anonymous developer or group of developers, first announced Bitcoin to the world in 2009.
It has since become the world’s most well-known cryptocurrency. Many other cryptocurrencies have sprung up as a result of their popularity.
China was formerly the world’s Bitcoin trading and mining capital. The country’s authorities, on the other hand, have tried for years to find ways to control cryptocurrency’s growing popularity and prevent it from depreciating and replacing its fiat currency.
As a result, in September 2021, China’s government eventually banned non-government-approved cryptocurrencies. As a result, Bitcoin mining began to decline in October, with global mining falling to 55%. It continued to fall steadily until June 2021, when all mining in China ceased.
Bishijie, a Chinese cryptocurrency investor’s online community, shut down its website and app in mainland China in July 2021, and BCTChina, which had managed the country’s largest cryptocurrency exchange, said it was no longer involved in cryptocurrency-related activities.