A new ruling from the Shanghai High People’s Court in China added a new twist to its view on cryptocurrency after declaring Bitcoin as a virtual asset protected by Chinese law.
The Court also deemed Bitcoin to have economic value. “In the actual trial practice, the People’s Court has formed a unified opinion on the legal position of bitcoin, and identified it as a virtual property,” it said on its official WeChat channel.
Back in October 2020, Cheng Mou requested that Shi Moumou to return a loan of one (1) bitcoin, which Mou claimed belong to him. Moumou, the defendant, refused to return the bitcoin, bringing the case to the District People’s Court. Since the May 2021 mediation, the parties agreed that the defendant would provide compensation at a discount from the value of the Bitcoin at the time of the loan.
The case eventually moved up to the Shanghai High People’s Court. The Supreme People’s Court is the highest court in Chinese states.
New crypto precedent in China?
This latest ruling could set a new precedent for how virtual assets are viewed in Chinese law.
Historically, the Chinese government has discouraged crypto trading, shunning miners in attempts to reduce energy consumption. Last year, China outright banned all crypto transactions and mining within its borders.
“Virtual currency-related business activities are illegal financial activities,” the People’s Bank of China said in September last year. It also warned Chinese citizens that crypto trading could “seriously endanger the safety of people’s assets.”
A high people’s court in China is the highest local court in Chinese provinces, preceded by the people’s courts and intermediate people’s courts. Similar to how the Supreme People’s Court is structured, the High Court is also controlled directly by the central government.
Digital Yuan expands to transport networks
China has since taken steps forward in introducing a central bank digital currency (CBDC) with its digital yuan. Since its launch, the digital yuan usage has surged, with the cities of Xiamen and Guangzhou becoming the latest to incorporate the currency in the transportation sector.
The People’s Bank of China announced it would be expanding the CBDC pilot program to 11 new cities, bringing the total number to 23 cities under the program.
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BeInCrypto has reached out to company or individual involved in the story to get an official statement about the recent developments, but it has yet to hear back.