Home News Bitcoin Despite Government Uncertainty, China Court Recognizes Validity of Bitcoin

Despite Government Uncertainty, China Court Recognizes Validity of Bitcoin

October 26, 2018 12:40
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The battle between bitcoin and China has always been one fraught with tension and uncertainty. Earlier this year, the country was hellbent on removing bitcoin from the public consciousness.

Lately, however, the government has been taking baby steps towards understanding the technology and trying to integrate it in their policies. Recently, however, there was a case involving cryptocurrencies that might just break the stalemate that the government is in.

The case stated that three people A, B and C had signed the “Equity Transfer Agreement”, that stipulated that the respondent C shall transfer 5% of the shares of Company X held by the applicant. The equity transfer amount was 550,000 yuan, of which 250,000 yuan was paid by the respondent C to the applicant A.

Since Applicant B entrusted the respondent C to manage the assets such as Bitcoin, based on the partial income generated by the part of the assets, the respondent C will return the BTC, BCH and BCD agreed upon in the contract to the applicant B as scheduled. Person B agreed to pay the applicant’s share of the remaining equity transfer of 300,000 yuan instead of the respondent C. After the signing of the agreement, the respondent C did not return BTC, BCH and BCD in accordance with the contract, and did not pay the equity transfer payment according to the contract.

The court in its response stated that although, bitcoin’s legality is not clear in China, “bitcoin return contract concluded between private individuals does not violate the mandatory provisions of the legal and regulatory effects and should not be considered invalid. Chinese laws and regulations do not prohibit privately held and legally transferred bitcoin.”

The court added that bitcoin is protected by law as it has property attributes, “that can be dominated and controlled by manpower, have economic value, and can bring economic benefits to the parties. This is the meaning of the parties’ agreement and does not violate the legal provisions. The arbitral tribunal recognizes this.”

Earlier this week, the China government-owned media company signed an agreement with another company to set up a blockchain lab. This is a stark change from the scenario a few months prior when WeChat and Alipay stated that they would not allow any cryptocurrency related activities on their platform.

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A blockchain enthusiast, a wannabe-crypto investor and an all-around enthusiast! Loves travelling, especially to ASI-protected areas, believes in giving her best shot at everything she does! Definitely an introvert.

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