Shanghai High Court Declares Bitcoin a Commodity

The Shanghai High Court has made an important statement on the status of cryptocurrencies in the country in a published document.

Shanghai Court: Virtual Currency Is Property Under Chinese Law
The Shanghai High Court has reaffirmed that virtual currencies, considered virtual goods , are property under Chinese law.

According to court documents, virtual currencies are not completely banned in China, but related commercial activities face strict restrictions .

Chinese authorities maintain a tough stance on cryptocurrency trading and speculation, citing concerns about regulatory risks and financial instability . Activities such as initial coin offerings (ICOs) and fundraising involving cryptocurrencies are classified as illegal financing.

Legal Disputes Involving Virtual Currency
A recent case at the Songjiang District People's Court in Shanghai highlights the legal issues surrounding cryptocurrencies.

Specifically, in 2017 , when Bitcoin and Ethereum were soaring in price, an agricultural company, known as Company X , partnered with Company S to issue tokens and raise capital through blockchain technology.

Company X paid 300,000 yuan to Company S to carry out the project, including drafting the white paper and using smart contracts.

However, this initiative is considered illegal, as China bans all activities related to ICOs and virtual currency trading .

Conclude
Although recognized as property, virtual currencies in China are still strictly regulated and are not allowed to be used for financial purposes.

Legal cases like these highlight the challenges the cryptocurrency sector faces in the country’s complex legal landscape.