The Shanghai Second Intermediate People’s Court in China has recognized Bitcoin as a unique and non-replicable digital asset, acknowledging its scarcity and inherent value. In a recent report on the development of internet technologies, the court highlighted Bitcoin’s distinctive properties among virtual currencies and its resemblance to traditional currencies in terms of scalability, circulation, storage, and payment. Despite China’s blanket ban on cryptocurrencies, this judicial recognition gives Bitcoin and other digital currencies in the country more legitimacy. Over the years, Chinese courts have increasingly acknowledged digital assets as legal properties protected by law, despite Beijing’s hostile attitude towards Bitcoin.
China’s recognition of Bitcoin as a unique and valuable digital asset comes in stark contrast to the country’s overall stance on cryptocurrencies. As recently as 2021, China imposed a ban on all cryptocurrency activities, including Bitcoin mining. However, various local courts have consistently recognized Bitcoin and other digital assets as protected legal properties. This latest acknowledgment from a key Shanghai court further strengthens the argument for defining Bitcoins as personal property and provides additional legitimacy to cryptocurrencies in China. Despite the absence of a central authority and the decentralized nature of Bitcoin, its global usage continues to grow.
While Beijing’s attitude towards Bitcoin remains hostile, this recognition from the Shanghai court signifies a positive shift in the perception of digital assets within China’s legal system. The court’s report emphasizes Bitcoin’s unique features and its distinction from other virtual currencies. Notably, the report highlights Bitcoin’s scarcity and attributes as key factors contributing to its inherent value. This recognition carries significant weight in a country with a strong regulatory stance against cryptocurrencies, as it bolsters the legal arguments supporting the protection and validity of digital assets such as Bitcoin.