Chinese court contradicts the government's position on virtual currencies and declares them legal property

According to reports, a Chinese court has ruled that virtual currency should not be considered illegal under the country's legal framework. Such a position directly contradicts the CCP's policy towards them.

The People's Court of China has ruled that virtual currency should not be classified as illegal under current policy. This was reported on September 1 by the news outlet Web3 Odaily from Beijing.

According to Odaily, the court decided to consider virtual currencies property in accordance with applicable law. He proposed to consider cases related to criminal proceeds from virtual currencies on a case-by-case basis. In order to find a balance between private and public interests, it is necessary to consider such acts separately for each specific case.

The primary court documents were not publicly available at the time of publication.

Perhaps this is a more significant shift in the legal perspective due to China's historical struggles with cryptocurrencies. China is a country that has a long history of antagonism towards the crypto industry. From 2013 to 2017, the Chinese government imposed bans on the processing of bitcoin transactions in banks, then it canceled coin offerings (ICOs) and banned fundraising. Cryptocurrency mining was canceled in 2019. And these are just some of the many other measures the CCP is taking in order to reduce the adoption of cryptocurrencies in the country.

This is not the first time a Chinese court has challenged the government's policy towards cryptocurrencies. A 2018 trial in Hangzhou further confirmed Bitcoin's legal status as "virtual property", marking the first time that a Chinese court has contradicted the policy. Ignoring the illegal status of trading and mining, the court decided that bitcoin is property. Factors such as the shortage (significance) of the product as well as its responsibility were also taken into account. However, it is unclear whether this initiative was seen as a precedent for today's decision.

This story of China with blockchain and cryptocurrency is a convoluted narrative in which there is a constant tension between innovation and state control. In addition, China has shown great interest in harnessing the potential of blockchain technology. He issued national blockchain standards to guide the development of the field, launched a research center, and took many steps towards the introduction of the digital yuan, the first true central bank digital currency (CBDc), the first true numerical asset of the Central Bank. These efforts have been centralized, with the state playing a key role in guiding the blockchain use case level.

The PDA fascination with blockchain technology does not extend to decentralized cryptocurrencies. About twenty companies engaged in cryptocurrency trading were forced to leave China due to a strict ban on it. The Chinese government is pursuing a policy of maintaining control over the country's financial system. The Chinese government clearly favors technologies that it can control and manage in a manner similar to the digital yuan issued by the People's Bank of China.

The country's stance on generative AI rules demonstrates a similar authoritarian stance, where such systems are designed to meet the "core values of socialism." As a country expands its incentives for innovation, it does so within a tightly controlled framework that is consistent with its sociopolitical goals.