China’s Shenzhen Court of International Arbitration appears to have ruled against the country’s central bank’s earlier decision to ban all cryptocurrency. The court’s argument was published recently through WeChat, a popular social media platform, seemingly asserting digital assets such as Bitcoin are in fact protected property.
China Court Takes Civil Crypto Dispute Decision to WeChat
People’s Bank of China (中国人民银行, Zhōngguó Rénmín Yínháng) has at every turn acted to effectively prohibit cryptocurrency use and adoption in the communist nation. What was once a bright spot of innovation and startup culture turned into a nightmare scenario as enthusiasts were forced to do business elsewhere.
What legally remains is mining, and industry observers fear even that aspect of the ecosystem could soon also come under fire. The country’s zealous prohibition has been a boon for regional neighbors. Hong Kong, and other jurisdictions to China’s immediate west and south have attempted to pick up the slack, to fill that vacuum.
To many analysts, then, it was a shock to see some, albeit minor, official push back. That it comes in the form of the Shenzhen Court of International Arbitration and published on a social media platform, WeChat, itself under similar government scrutiny, was equally surprising though the court prides itself on “Independence • Impartiality • Innovation.”
Crypto is Property
Through a rough google translation, the decision comes by way of a civil contract dispute involving crypto trading and custody. One accused the other of missing critical agreed-upon delivery dates, marks, and looked to the arbitration body to sort through what is to become of 50 bitcoin cash, 20 bitcoin core, and 13 bitcoin diamond, totaling nearly half a million dollars.
“The Arbitration Court noticed that,” the online decision explained, “after September 2017, major bitcoin exchanges operating in China at the time suspended their businesses. But technically, that fact does not prevent the defendant from sending the bitcoin and bitcoin cash at dispute to the plaintiff upon the agreed deadline […] Bitcoin has the nature of a property, which can be owned and controlled by parties, and is able to provide economic values and benefits.”
It went further to reveal despite banning crypto as legal tender, China’s contract laws protect crypto holders. It was a roundabout way, using contractual obligations, to get a fundamental point across: no Chinese law is in circulation to prevent crypto possession, nor their use so long as it’s peer-to-peer.
“Bitcoin has the nature of a property, which can be owned and controlled by parties, and is able to provide economic values and benefits,” the court ruled.
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