On 23 Aug. 2021, Shandong High People's Court published Ma v. Liu et al. (2021) on its official Wechat account, as a typical case on the application of the PRC Civil Code. The court confirmed that citizens' investment and trading in virtual currencies is against Chinese laws and is not protected by law.
Jinan Intermediate People’s Court, Shandong, the second-instance court, in this case, held that Velas Coin is a kind of virtual currency similar to bitcoin. Pursuant to the notice and announcement issued by the People’s Bank of China and other relevant authorities, virtual currencies are not issued by the authority issuing legal currency, and, therefore, are not legal tender and compulsory currency in nature, and cannot and should not be circulated and used as legal currency in the market. Citizens' investments and transactions of virtual currencies are in violation of relevant laws. In this case, Ma entrusted Liu, Chang, and Li to help him to register a Velas Coin account and purchase Velas Coins, which constituted a type of entrustment contract. In accordance with Article 8 of the Civil Code of the People's Republic of China, civil subjects shall not violate laws and public order, and good customs when engaging in civil activities. Although the contract is based on the true intention of all parties, the act of Ma entrusting Liu, Chang, and Li to help him buy Velas Coin is not protected by law in China, and such type of entrustment contract is not protected by law in China.
Cover Photo by billow926 (https://unsplash.com/@billow926) on Unsplash
Contributors: CJO Staff Contributors Team
