- Shanghai court confirmed that personal cryptocurrency ownership was legal.
- China retained dominance, controlling over 50% of the global Bitcoin hash rate amid the regulatory shift.
In a groundbreaking move, a Shanghai court confirmed that personal ownership of cryptocurrencies does not violate Chinese law.
This unexpected clarification provided much-needed legal assurance for crypto holders in mainland China. This signaled a shift in the country’s stance on digital assets.
Interestingly, this announcement coincided with an extraordinary surge in Bitcoin’s [BTC] price, approaching the $100K mark and fueling ongoing speculations.
Judge Sun Jie weighs in
Additionally, Judge Sun Jie of the Shanghai Songjiang People’s Court recently provided much-needed legal clarity for cryptocurrency holders in mainland China.
In a statement published on the Shanghai High People’s Court’s official WeChat account, Sun confirmed,
“Not illegal for individuals to hold cryptocurrency,”
Despite the ongoing ban on cryptocurrency transactions that was imposed in 2021, this ruling offered a significant legal distinction. This highlighted that personal possession of digital assets does not violate Chinese law, even as regulatory restrictions on crypto trading remain in place.
That being said, highlighting the difference between owning and transacting in cryptocurrencies, Sun explained,
“That is why laws and regulations always maintain a high-pressure crackdown on speculative activities in cryptocurrency trading.”
This clarification was made during a case review involving a legal dispute between two companies over an ICO, which remains prohibited in China, alongside cryptocurrency mining.
China’s crypto history
For those unaware, in 2021, China’s government imposed a ban on cryptocurrency trading and Bitcoin mining following a surge in BTC’s price to $64,000, leading to a market correction with Bitcoin dropping to $30,000.
Despite this, Chinese citizens continued holding cryptocurrencies, using foreign exchanges to buy and sell.
Many speculate that China’s recent move may be a response to former President Donald Trump’s push to establish the U.S. as a global crypto hub.
However, it’s important to note that China’s dominance in the cryptocurrency space remains unquestionable.
China still controls over 50% of the global Bitcoin hash rate, dominating mining operations.
Moreover, Chinese investors are finding alternative ways to engage in crypto, prompting questions about China’s long-term strategy.
Hence, former Vice Minister of Finance Zhu Guangyao’s recent call for the government to reassess its stance on cryptocurrencies. This reflected the complexities surrounding China’s position as global trends and policies evolve.
What’s more?
In conclusion, Eliézer Ndinga, Vice President at 21Shares, clarified that the legal stance in China has remained consistent.
While individuals have always been allowed to hold cryptocurrencies, commercial crypto activities, including trading and mining, have been prohibited for some time.
He put it best when he said,
“[China has] nothing like the Executive Order 6102, which forbid holding gold in 1933 in the US.”
