A Shanghai district court ruled that a Bitcoin owner had the right to be compensated in a case involving unpaid loans. It also ruled on Bitcoin’s legal status.
A document was issued by the Shanghai High People’s Court stating that Bitcoin is subjected to property rights laws. This was in connection to a lawsuit that was filed in October 2020 in a district court regarding the recovery of 1 Bitcoin ( Bitcoins). The lower court recognised Bitcoin’s value, scarcity, and disposability, and therefore it was subject to property rights. It also met the definition of virtual property.
According the Sina website the Shanghai Baoshan District People’s Court ruled for plaintiff Cheng Mou and ordered defendant Shi Moumou return the Bitcoin. The case was remanded to the court after the defendant failed to comply. A mediation was held in May 2021. The parties reached an agreement that the defendant would pay compensation at a discount on the Bitcoin’s value at the time of the loan.
Since Bitcoin trading is prohibited in China, it was impossible to determine the current value of the Bitcoin loaned. According to the publication, the case was complicated further by the restrictions of enforcement and court investigator authorities that cannot inquire about virtual property.
China started cracking down cryptocurrency trading, and increased its efforts in 2017. It began to remove cryptocurrency miners from power grid, and KV against crypto market. Since then, it has turned its attention on “NFT-related illicit financial activities.”
China is also leading the way in by introducing a central-bank digital currency (CBDC). The Beijing Winter Olympics saw the first widespread use of the digital yuan, in spite COVID-19 restrictions.