As Chinese media outlet BJ news reported recently, The Hangzhou Internet Court, one of the three of this kind in China, made a ruling on July 18. The ruling recognises Bitcoin’s legal value, along its peers. Therefore, they are considered property of an individual or company.
Every time something happens in the legal environment to cryptocurrencies, it makes it to global news. That is because this market is still lacking full and explicit regulation, investors have eyes on what is happening legally. This results in market movements when such an event is taking place.
It is not unknown that China is not one of the countries that embraces the crypto phenomenon. It has taken many measures against such as imposing an ICO blanket ban, which made Chinese startups flee to Japan. There was a similar thing happening with crypto exchanges, too. Fortunately, they found a solution, changing domain names and reinventing themselves under different corporate structures (read more here). These are hardily accessible, though, so people are mostly using peer-to-peer platforms such as LocalBitcoins. I have written an article about avoiding identity verification and KYC here. I listed this website as one of the possible ways of doing so.
The reason why China was against this ecosystem is due to its central feature: decentralisation. This means the country’s communist government has barely any control over it. Of course, they are not happy with such a thing. Therefore, they tried to make it as hardly accessible as possible.
Despite of this, the Chinese central bank is working on developing its own cryptocurrency. Rumors say they are planning a fight against Facebook’s Libra.
The ruling this internet court has been made was in a trial that was dating back to 2013. A buyer claimed that they paid a vendor for 2.675 BTC, but failed to receive the said tokens after the vendor closed its operations. Of course, this was before 2017, when China took its major measures against cryptocurrencies.
The court ruled in favour of the buyer, stating that Bitcoin is “virtual property”, and therefore “protected by Chinese law”. Bitcoin and other tokens are not considered legal tender in the country and will probably not be anytime soon.
This move does, however, give Bitcoin and its peers a legal precedent people and authorities can rely on. On one hand, the authorities will be able to seize cryptocurrency holdings in the cause of fraud or other felonies. On the other hand, optimists are very happy about this because they consider it a major step ahead.
These news have certainly had a small effect on the market, keeping the bull run from seeing any obstacle. Although there were some negative movements this week, nothing was very major. Bitcoin was able to finish the week above the $10K level, being for some time during this period shortly under. Everything is moving in the right direction, though, and I am really looking forward for the future. I believe it is now clear that great practical ideas are exactly what the market is looking for right now.
Anyhow, if you want to add something, feel free to leave a comment below. If you want to get in touch with me personally, use this link.