A Chinese court ruled that Ethereum is “legal property with economic value”. The ruling followed similar ones, which, however, concerned Bitcoin.
The case that was administered by the court in Shenzhen concerned a theft of Ethereum. In order to settle the matter, it was decided that the cryptocurrency is property for all intents and purposes.
The case originated when the protagonist, Li, a blockchain engineer, in 2019, joined a Shenzhen company involved in a project called Haode Star with a partner company. Thanks to his qualifications, Li created the project’s private key and payment password. When he was fired because his probationary period ended and he was not deemed fit to continue, Li decided to use the project’s private key and password to get into Haode’s account and steal 3 ETH and 4 million Haode tokens.
He later managed to get another 0.4 ETH. The stolen tokens were then returned. However, the judge sentenced the protagonist to seven months in prison and will also have to compensate the company that was the victim of the theft.
The real implication of the sentence is that the court recognizes that it is not forbidden to hold cryptocurrencies in China despite the government’s ban.
The ruling says that:
“We cannot deny the fact that ether should be protected by law as a general property.”
The final judgement is in line with at least a couple of other judgements that were expressed in a similar way and which had Bitcoin as their object.
Currently, financial institutions in China cannot conduct operations in cryptocurrency. Nevertheless, China remains one of the nerve centres for Bitcoin mining even though the effects of the bans have been felt by contracting “production”.