Bitcoin China Law New Direction
Bitcoin China Law
China is the largest market for Bitcoin. Most trading volume is done in Yuan, through China based exchanges. Further, most of the network’s hashing power comes from China based miners. However Bitcoin China law remains mostly unclear.
China has strong capital controls, enforced by its heavily centralised Government. For this reason, Bitcoin could be understood as problematic. However, China’s exchanges, miners and businesses all operate legally, in the open.
In 2013, when Bitcoin started to gain mainstream attention and popularity worldwide, and in China, the PBOC ruled that Bitcoin was a “virtual commodity”.
However, Chinese law is still unclear as to the status of this “virtual commodity”. As it is “virtual” in nature, it is difficult to classify along with other physical property.
CN General Provisions Civil Law (Draft): Virtual assets will be officially protected by law. Providing legal basis for BTC related cases
— cnLedger (@cnLedger) June 28, 2016
Bitcoin China Law and New Code
An updated draft of the Chinese Civil Code may clarify as to this ambiguity.
It does not amount to firm legal recognition of Bitcoin property rights. However, it would codify people’s right to own virtual assets generally.
Specifically, as Bitcoin Magazine notes, this legislation would:
“…designate all virtual networks, data and information as property equal to physical and other financial assets, bringing them under the jurisdiction of civil rights that are applicable to property in general…”
Opinion amongst Bitcoin industry leaders inside China is somewhat divided. However positive, there is scepticism across the board that the proposed legislation will have any specific implications for Bitcoin and digital currencies. At best it may be a reference for future legal incidents. It may also signal some acknowledgment and tacit acceptance of the growth of Bitcoin within China.
Bitcoin China Law and Market Opinion
As Bitcoin magazine notes that;
“…the Chinese government, so far, has not denied that digital currencies would be included in the new law.”
The updated legislation is still very much in draft form and under discussion.
Perhaps it is best understood as OKCoin CEO Stary Xu puts it, as;
“…the manifestation of legal progress in China and it will benefit the Bitcoin industry in the long term.”
It will be very interesting to see how this plays out. As the China market has a huge effect on Bitcoin globally, especially in terms of price and trading.
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