China: Bitcoin Should Be Protected as Property by Law, Arbitration Court Rules

The Shenzhen Court of International Arbitration has recently ruled that cryptocurrencies like bitcoin should be protected by law as property, in a case that saw two parties dispute cryptocurrency possession at the end of a business contract.

The court case, first spotted by Chinese news source cnLedger, details an unnamed plaintiff signed a contract with a defendant, so the latter would use the plaintiff’s cryptocurrencies to trade on his behalf. Per the case, the defendant failed to properly manage the cryptocurrencies, and subsequently refused to return them.

The defendant argued that a ban from the country’s central bank, the People’s Bank of China (PBoC), in late 2017 on cryptocurrency trading platforms and initial coin offerings (ICOs) means cryptocurrency payments and transactions should be illegal in the country, which would mean the entire contract was invalid.

The defendant further argued the ban made it impossible to trade cryptocurrencies in the region. The court noted the case wasn’t about cryptocurrencies, but about the contractual obligation the defendant had of returning the cryptocurrencies.

The contractual obligation, it noted, doesn’t fall under the PBoC’s ban on cryptocurrency trading. In fact, the arbitrator argued there are no laws surrounding cryptocurrency ownership and transactions between citizens. As such, it implied, seemingly nothing stopped the defendant from sending over the funds.

Per the court, whether bitcoin is legal tender or not, it should still be legally protected as property. The case’s analysis reads:

Bitcoin has the nature of a property, which can be owned and controlled by parties, and is able to provide economic values and benefits.

Currently, no laws govern cryptocurrencies in China, so the country’s thinking into the nascent industry is seemingly being decided on a case-by-case basis. In this one, 20 BTC, 50 BCH, and 13 BCD were included in the dispute.

Notably this isn’t the first case in China where a court rules a cryptocurrency should be “protected by law.” As CryptoGlobe covered, the Shanghai Hongkou District Court ruled ETH should be protected as general property in a case that saw a defendant refuse to return 20 ETH to an ICO investor.

A post analyzing the case read:

The court considered that the current state didn’t recognize the monetary properties of so-called “virtual currencies” such as ether, and prohibited financial activities in them, including their circulation. However it cannot deny the fact that ether should be protected by law as general property.

The analysis’ author, at the time, noted the case may have set a precedent in the country, which was likely to keep on admitting cryptocurrencies should be protected by law as property.

Irish Drug Dealer Forced to Surrender €52 Million in Bitcoin to Authorities

Michael LaVere
  • An Irish drug dealer was forced to surrender €52 million in crypto to the Criminal Assets Bureau.
  • High Court determined the proceeds to be the result of a crime. 

A drug dealer was forced to surrender €52 million (around $56 million) in cryptocurrency to Ireland's Criminal Assets Bureau (CAB) after the country's High Court determined it to be proceeds from a crime. 

According to the report by Irish news outlet Independent, Dubliner Clifton Collins accumulated more than €52 million in the illegal sale and supply of drugs. Justice Alex Owens ruled that the bitcoin should be forfeited under the Proceeds of Crime legislation, a decision that went uncontested by Collins. 

The report claims authorities discovered a quantity of cannabis in Collins possession after a vehicle stoppage which took place in February 2017. Authorities went on to find a large number of suspected cannabis plants at an address at Farnaught, Corr na Móna. A subsequent investigation by the CAB led the bureau to uncover Collins's extensive holding of crypto assets, which amounted to €52 million. 

The report claims that Collins was an early investor in bitcoin and crypto-assets, which appreciated exponentially over the years. The CAB was able to secure a freezing order on the bitcoin to ensure that it could not be moved from the wallet prior to a court ruling. 

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