The Shenzhen Court of International Arbitration in China has reportedly legalised the acceptance of Bitcoin payments by merchants in the country.
According to the court’s ruling, Bitcoin shall be considered as an asset or a property, rather than a digital currency. This enables ownership, trading and transfer of Bitcoin similar to any property.
After analysing the court documents, Crypto researcher research Katherine Wu noted that Bitcoin’s decentralised nature provides financial freedom and economic value to the owner.
The court issued the ruling while resolving a case on an agreement for the transfer of cryptocurrencies.
The defendant managed a cryptocurrency portfolio, comprising 20 Bitcoin, 50 Bitcoin Cash and 13 Bitcoin Diamond, on behalf of the plaintiff. A dispute occurred when the defendant failed to return cryptocurrencies to the plaintiff on the agreed deadline.
The defendant argued that the ban on ICOs and virtual currency trading makes the contract void as cryptocurrency payments are illegal.
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Responding to the arguments, the court noted that the ban did not cover private transfer of Bitcoin and other cryptocurrencies, and asked the defendant to pay certain amount to the plaintiff for breaching the contract.
The court said: “There is no law or regulation that explicitly prohibits parties from holding bitcoin or private transactions in Bitcoin, [only warnings to] the public about the investment risks. The contract, in this case, stipulates the obligation to return the bitcoin between two natural persons, and does not belong to the [Sept- 2017 ban].”