Shanghai Court Rules Personal Bitcoin Ownership Is Legal, but Business Entities Are Banned from Crypto Investments

In a step toward regulatory clarity for Bitcoin holders in China, a Shanghai court has issued an opinion stating that personal ownership of digital assets is not illegal under Chinese law.

A Shanghai court has stated that personal ownership of digital assets is not illegal in China, offering a glimmer of regulatory clarity for Bitcoin holders in the country.

The opinion was articulated by Sun Jie, a judge at the Shanghai Songjiang People’s Court, and published on the official WeChat account of the Shanghai High People’s Court.

The court clarified that while individuals are permitted to own cryptocurrencies, business entities in China are still prohibited from engaging in cryptocurrency investments or token issuance without regulatory approval.

This clarification emerged as the court reviewed a lawsuit involving disputes between two companies over an initial coin offering (ICO), which is considered illegal financing in China.

Despite this backdrop, Sun noted that cryptocurrencies are regarded as virtual commodities with property-like attributes, which are not prohibited for personal ownership.

“The laws and regulations maintain a high-pressure crackdown on speculative activities in cryptocurrency trading,” Sun stated, highlighting the government’s approach toward the industry.

This sentiment aligns with Beijing’s broader strategy to prevent “disruptions” to the economic and financial order, especially amid concerns about illegal activities being facilitated by cryptocurrencies.

In a related incident, Yao Qian, a former director of the People’s Bank of China’s digital currency research institute, was reportedly implicated in a bribery case involving cryptocurrency, underscoring the complexities and contradictions within the Chinese regulatory landscape.

While the recent opinion provides clarity, it has been an open secret among industry insiders that individual cryptocurrency ownership has been tolerated. Certain courts have previously ruled that cryptocurrencies should be treated as property protected under existing legal frameworks.

However, there remains no indication that Beijing intends to relax its stringent regulations on the crypto industry, despite calls from experts for a more open market approach.

no indication that Beijing intends to relax its stringent regulations on the crypto industry, despite