PANews reported on September 25 that Article 36 of the recently issued Shandong Province Confiscated Items Disposal Procedures (Trial) (2023) stipulates that prepaid cards and virtual currencies that have been confiscated by law by law can be negotiated with the merchants that issued the prepaid cards and virtual currencies. The merchant will bid for the recovery of the prepaid cards and virtual currencies. The recovery price is agreed upon by both parties and in principle shall not be less than 80% of the face value or balance of the virtual currency or prepaid card. The two parties will sign a recovery agreement.
According to lawyer Liu Yang’s analysis, the Notice is a local government regulation in terms of legal status. The Notice does not specify whether “virtual currency” includes virtual digital currencies represented by Bitcoin, Ethereum, and Tether. If the above virtual digital currencies are included, the clause has the following regulatory significance: First, it can only be negotiated with the issuer of virtual digital currency. For Bitcoin and Ethereum, the corresponding foundation can be found, and Tether can be found by Tether Company. The Notice does not allow sales to third-party companies. Second, it must be recovered by the issuer, and not less than 80% in substance. Lawyers believe that if virtual digital currencies are included, the clause will be difficult to operate in actual disposal, and virtual digital currencies may still be in an embarrassing situation where there is no law to rely on.
Lawyers are more willing to believe that the virtual currencies mentioned in the "Notice" are still highly centralized virtual currencies with domestic issuers, represented by Q coins and Douyin coins.
