As reported by CnLedger, a trusted cryptocurrency news source in China, the country’s merchants can legally accept crypto as a payment method.
According to local reports, the Shenzhen Court of International Arbitration officially recognized Bitcoin as a property, allowing individuals and businesses to own and transfer Bitcoin without being in conflict with existing financial regulations.
“Chinese court confirms Bitcoin is protected by law. Shenzhen Court of International Arbitration ruled a case involving cryptos. Inside the verdict: CN law does not forbid owning & transferring bitcoin, which should be protected by law because ofits property nature and economic value.”
Circulation and the Payment of Bitcoin in China is Not Illegal
Katherine Wu, a cryptocurrency researcher at Messari, translated and analyzed court documents released by the Shenzhen Court of International Arbitration to delve into the reasoning behind the decision of the arbitrator to consider Bitcoin as a property.
In essence, Wu explained that due to the decentralized nature of Bitcoin that provides financial freedom and economic value to the owner, the asset can be recognized as a property.
“The Party contends that Bitcoin has characteristics of a property (SOV), can be controlled by the owner, and has economic value to the owner. It does not break any laws. This arbitrator agrees,” Wu said.
As such, the court emphasized that regardless of the legality of Bitcoin and other major cryptocurrencies, the circulation and payment of Bitcoin is not illegal. That means, merchants can freely accept cryptocurrencies as a payment method without breaking the local law.
“In the arbitrator’s view, whether or not bitcoin is legal, the circulation and the payment of bitcoin is not illegal. Bitcoin does not have the same rights as fiat, but that does not mean that holding or paying with crypto is illegal.”
Earlier this month, China’s oldest technology publication Beijing Sci-Tech Report (BSTR), a respected media company in the country, released its plans to accept Bitcoin for its yearly subscription to promote the usage of the blockchain and practical use cases of the dominant cryptocurrency.
BSTR revealed that starting 2019, the yearly subscription to its magazine will be sold at a price of 0.01 BTC, worth around $65. If the price of BTC rises substantially in the future, the publication stated that it will compensate its customers.
Several hotels in major cities in China have also started to accept cryptocurrencies, one of which branded itself as Ethereum Hotel, providing merits and discounts to those that pay for their services using Ethereum.
What Does This Show About China?
In consideration of China’s optimistic stance towards blockchain technology and positive comments regarding the sector made by government agencies, it has become more apparent that the government placed a blanket ban on cryptocurrency trading to prevent the devaluation of the Chinese yuan and to limit speculation in the market.
But, overall, the government remains open to crypto and the usage of the blockchain to improve existing infrastructures and problems pertaining to software and data settlement.
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Last modified: March 4, 2021 3:04 PM