The Chinese court has decided that its citizens can continue to trade cryptocurrency despite China’s prohibition on digital assets and services. It is noteworthy that China has a ban in place on cryptocurrency trading, which is based on the risk to the financial sector’s stability.
The Beijing Number One Intermediate People’s Court decided that interested investors could only trade in cryptocurrencies, but they should be considered as virtual assets, and not as an actual currency.
The decision was made in a case that involved an e-loan in Litecoin (LTC) that came with the guarantee of interest payments in digital currencies. The trial details indicate that in the year 2015 Zhai Wenjie lent the friend Ding Hao the sum of 50,000 dollars in Litecoin. Zhai Wenjie said that Ding Hao was obligated to pay him 1,000 Litecoins in monthly interest and that the defendant has denied.
The status of the currency Litecoin
The court did not deny the current Chinese prohibition on trading in cryptocurrency The judge who presided stated that Litecoin cannot be considered an official currency. The court ruled that the cryptocurrency cannot be issued by a monetary authority , and has the absence of backing by legal and financial frameworks.
“According to administrative regulations and court cases, our nation does not deny the financial attributes of virtual currencies and bans the circulation of it as a currency, however, the virtual currency is itself a virtual asset that is protected by statute,” the court ruled.
It is interesting to note that, within the existing prohibition regarding Bitcoin ( BTC) The court also considered Litecoin in a separate ruling, noting it has laws in place to regulate these assets.
In the case, the judge pointed out an absence of law that prohibits the idea that Litecoin was an asset that is illegal. The judge therefore was in the favour of the plaintiff in showing that the defendant had borrowed the cryptocurrency and directed the defendant to repay his Litecoin.
China’s position on cryptocurrencies
The decision is a follow-up to the recent decision of an administrative court in Chaoyang which ordered companies not to pay wages with the form of Tether ( USDT) because of the ban on circulation in digital currency.
It is important to note that various Chinese court systems have handed out different rulings on the handling and trading of electronic assets. For instance as noted in Finbold in May this year, it was the Shanghai High People’s Court ruled that Bitcoin has a “certain economic value and is protected under the laws of China.
Incredibly even though the country has banned cryptocurrency services, the latest research suggests there is a greater number of Chinese residents are trading in various assets. As noted in Finbold, China now ranks at the top of the list in the adoption of crypto.
China continues to be a leader in the field of adoption
The popularity of cryptocurrency is still high in China. This is despite the complicated complex, complicated and sometimes quite incompatible system.
According to the data that were released by the on-chain analysis company Chainalysis The country is among the top 10 markets of the world’s crypto users However, it is only a fraction of the way. China is currently in the top 10 with number 10.
The most populous country in the globe is Vietnam. Ukraine ranks at number 3. Russia is one position higher than China at 9th place.
The complete top ten list are as follows: