China's Supreme Court recognized cryptocurrency as a commodity with limited legal use, but reaffirmed a strict ban on financing and business transactions with tokens.
China's Supreme Court released its stance on #cryptocurrencies and recognized them
"Attribute properties"
b Under Chinese law. This means that cryptoassets can be treated as commodities, but not as currency or business products. While this recognition provides limited legal protection, the court emphasized that financing through the #issuance or circulation of tokens is illegal.
The ruling was handed down in the case of two companies involved in a fraud dispute over a failed #token launch. The court condemned their actions and labeled them as illegal government funding. The court affirmed that no organization or individual has the right to engage in fraudulent token issuance or financing activities, demonstrating China's strict regulatory framework.
Despite such a strict stance, the court's perception of cryptocurrencies as a commodity suggests some legal possibilities. This view is consistent with China's selective support for blockchain technology, especially in areas such as cross-border payments and trade facilitation. At the recent BRICS summit, China emphasized the potential of blockchain in international trade, and used cryptocurrencies to trade with Russia. In addition, the digital yuan, China's CBDC, has been integrated into various global trade initiatives.
China's tough policy on cryptocurrencies has sparked a global debate about China's position in the rapidly evolving digital asset sector. Hong Kong recently approved the first bitcoin-ETF that will offer mainland investors indirect access to #bitcoin , but China continues to restrict the widespread use of cryptocurrencies. Meanwhile, other countries, including the United States, are considering using Bitcoin to counter China's economic influence.
The High Court's decision reflects China's cautious approach to cryptocurrencies.
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