China Justice Observer

中司观察

EnglishArabicChinese (Simplified)DutchFrenchGermanHindiItalianJapaneseKoreanPortugueseRussianSpanishSwedishHebrewIndonesianVietnameseThaiTurkishMalay

Chinese Court Says Virtual Currency Investing or Trading Not Protected by Law

Sat, 25 Sep 2021
Categories: China Legal Trends

On 23 Aug. 2021, Shandong High People's Court published  Ma v. Liu et al. (2021) on its official Wechat account, as a typical case on the application of the PRC Civil Code. The court confirmed that citizens' investment and trading in virtual currencies is against Chinese laws and is not protected by law.

Jinan Intermediate People’s Court, Shandong, the second-instance court, in this case, held that Velas Coin is a kind of virtual currency similar to bitcoin. Pursuant to the notice and announcement issued by the People’s Bank of China and other relevant authorities, virtual currencies are not issued by the authority issuing legal currency, and, therefore, are not legal tender and compulsory currency in nature, and cannot and should not be circulated and used as legal currency in the market. Citizens' investments and transactions of virtual currencies are in violation of relevant laws. In this case, Ma entrusted Liu, Chang, and Li to help him to register a Velas Coin account and purchase Velas Coins, which constituted a type of entrustment contract. In accordance with Article 8 of the Civil Code of the People's Republic of China, civil subjects shall not violate laws and public order, and good customs when engaging in civil activities. Although the contract is based on the true intention of all parties, the act of Ma entrusting Liu, Chang, and Li to help him buy Velas Coin is not protected by law in China, and such type of entrustment contract is not protected by law in China.

 

 

Cover Photo by billow926 (https://unsplash.com/@billow926) on Unsplash

Contributors: CJO Staff Contributors Team

Save as PDF

Related laws on China Laws Portal

You might also like

Guangdong High Court Highlights Landmark Mainland-Hong Kong Bankruptcy Ruling

Among 10 typical cases released by the Guangdong High People's Court to advance legal alignment in the Greater Bay Area, a landmark ruling (Re Guangdong Overseas Construction Corporation) stands out for securing Hong Kong judicial recognition for a bankruptcy administrator appointed by a mainland court outside designated pilot regions.

China Publishes First Typical Cases in Sports Arbitration

China Commission of Arbitration for Sports (CCAS) has released its first set of six typical cases, establishing a precedent, among others, that sports agency contract disputes fall under specialized sports arbitration rather than general commercial arbitration.

China Designates Beijing Court for ICSID Arbitral Awards

China has officially designated the Beijing No. 4 Intermediate People's Court to handle the recognition and enforcement of ICSID awards, filling a long-standing procedural gap and advancing its restrictive immunity framework.

PRC Double Interest neither Double nor Penal, Australian Courts Clear Its Name When Enforcing Chinese Judgments

Recent Australian case law clarifies that the “double interest” mechanism in the People’s Republic of China (PRC) monetary judgments functions as a compensatory post-judgment interest framework rather than an unenforceable penalty. This consolidates Australia’s position as a highly attractive and creditor-friendly forum for enforcing Chinese judgments. See Zhengzhou Lvdu Real Estate Group Co v Shu [2024] NSWSC 58 (6 February 2024), Fu v Pang [2025] VSC 597 (16 September 2025)