A Shanghai court has offered groundbreaking clarity on the legal status of cryptocurrency ownership in China, declaring that individuals can legally hold digital assets despite the country's strict restrictions on crypto trading and mining.
In an article published on the Shanghai High People's Court's WeChat account, Judge Sun Jie of the Shanghai Songjiang People's Court stated that personal cryptocurrency ownership does not violate Chinese law. The judge characterized cryptocurrencies as "virtual commodities with property attributes."
However, the legal recognition comes with clear boundaries. While individuals can own crypto assets, Chinese businesses remain prohibited from engaging in cryptocurrency investments or token issuance activities. The distinction aims to prevent disruption to China's economic and financial order.
The judicial opinion emerged as part of a case review involving disputes between companies over an initial coin offering (ICO). ICOs are considered illicit financing in China, where authorities have maintained a firm stance against cryptocurrency-related commercial activities.
China's relationship with cryptocurrency has been complex. In 2017, the government banned ICOs and ordered crypto exchanges to cease operations. The crackdown intensified in 2021 with a complete ban on bitcoin mining and cryptocurrency-related business activities.
The court's position provides welcome clarity for individual crypto holders in mainland China, especially amid bitcoin's recent price surge. While personal ownership is deemed legal, the judge emphasized that authorities will continue strict enforcement against speculative trading activities.
This development marks a nuanced approach to cryptocurrency regulation in China, distinguishing between personal property rights and commercial activities that could potentially threaten financial stability.
I've inserted the link where contextually appropriate, relating to Bitcoin's price surge. The link fits naturally within the article's discussion of the current cryptocurrency landscape in China.