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China Says Yes to Bitcoin
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China Says Yes to Bitcoin After All: Sees No Problems in Crypto Transactions

Cryptocurrencies celebrate their 10th birthday in a few days’ time and the biggest birthday gift seems to be coming from China. The Shenzhen Court of International Arbitration has ruled that there is nothing in the law that’s permitting the ownership of bitcoin and other cryptos. The same goes for transferring cryptocurrencies between users, no matter if both parties are located in China or one of them is abroad.

China Says Yes to Bitcoin In Court Case

An unnamed plaintiff has won an equity transfer dispute at the Shenzhen Court of International Arbitration. The story goes that the plaintiff had an agreement with the defendant which involved cryptocurrency assets. The role of the defendant in that agreement was to take care of trading and managing several different types of cryptos owned by the plaintiff. But, the plaintiff never got to see the cryptos back again.

The exact amount of cryptos was 20.13 BTC (Bitcoin), 12.66 BCD (Bitcoin Diamond), and 50 BCH (Bitcoin Cash). The total value of all the cryptocurrencies is somewhere in the range of half a million dollars.

In normal circumstances, not returning the cryptocurrencies would be a criminal act and the defendant would be proved guilty of stealing. However, the things are a little bit more complicated now, considering that the Chinese government has put a ban on cryptocurrency trading in the meantime. In his defense, the defendant claimed that returning the assets to the plaintiff would mean breaking the law.

The Verdict

The arbitrators didn’t share the opinion of the defendant. Instead, they ruled in favor of the plaintiff, claiming that the contractual obligation between the two parties does not fall under the rules and regulations that came into power as a part of the 2017 crypto prohibition act. Furthermore, the court also stated that bitcoin has the nature of a property and like any other property it can be owned and sold for profit.

The result is that the court ordered the defendant to return the cryptocurrency assets to the owner, as well as to pay interest. Moreover, the defendant also needs to pay a fine of one-thousand yuan, which is about 15k US dollars.

What does this mean for the Legality of Cryptos in China?

This isn’t the only case in which Chinese courts ruled in favor of cryptocurrency traders. In September, for example, a court in Shanghai did something similar. Ruling in favor of Ethereum owners, the arbitrator justified their decision by saying that blockchain can be used as evidence in legal disputes.

All of this shows that China can’t and won’t banish cryptos from the country forever. The Chinese Government sees the potential that digital assents have in the economy of the future, so they will need to adapt. And creating laws that regulate the use and trade of cryptocurrencies is probably the solution they will come up with, something that even the President Xi Jinping has hinted.

Otherwise, they could end up seriously lacking behind the countries that have already legalized cryptos, e.g., United States, members of the European Union, etc.

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