BY CNA Team - October 26, 2018
Chinese arbitrators see bitcoin as property to be protected
Bitcoins should be treated as property and be legally protected as such; a Chinese court of arbitration has ruled.
According to CoinDesk, the Shenzhen Court of International Arbitration published a case analysis on Oct 25 via the WeChat messaging app detailing a ruling on a dispute involving a business contract with crypto transactions.
“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 arbitrators say.
Details of the case showed that an unnamed plaintiff signed a contract with the defendant that allowed the latter to trade and manage a pool of cryptos on the plaintiff’s behalf.
The crypto news site reports that the defendant refused to return the cryptos after an agreed deadline.
The plaintiff says the crypto assets in dispute were 20.13 bitcoins, 50 bitcoin cash, and 12.66 bitcoin diamond valued at around US$493,158.
The arbitrators disagreed with the defendant’s argument that a ban by Beijing on cryptocurrency transactions and initial coin offerings since September 2017 meant that the contract is invalid.
The arbitrators’ analysis and ruling, according to CoinDesk, gives some idea on how crypto assets are being viewed by the Chinese courts, despite the lack of any specific laws relating to these assets and the ban.
They noted that there are no laws in the country that prohibits the possession of bitcoins and transactions between individuals.
They add that while crypto exchanges have been prohibited from operating their businesses after September last year, technically that does not prevent the defendant from sending the crypto assets to the plaintiff.
Their conclusion is that whether bitcoin is a legal tender or not, is irrelevant to the cryptocurrency’s legal protection under the country’s contract law.
Image courtesy of Shenzhen Court of International Arbitration website.