The decision of the Shanghai court, according to which the Ethereum is “legally protected property”, became an important legal precedent in the case of a possible further settlement of digital assets in China.
Court Shanghai HONGKOU district said that the Ethereum and a number of other digital assets are not money, however, according to the judges, this is an asset that is still subject to Chinese property law.
The decision was made in the course of the trial of the dispute of the Beijing technology company, and one of its investors. Although Chinese regulators take a tough stance against the cryptocurrency, the ruling represents an important precedent in the question of how Chinese law will continue to treat digital assets.
The problem arose in 2017, when the Chinese firm issued tokens to collect bitcoins and esters, and later decided to return 20 esters one of the investors so as a reaction to the tightening policy of the Chinese authorities in relation to cryptocurrency and ICO. It was later revealed that 20 coins Ethereum returned is “wrong”, and the investor has used governmental ban on the cryptocurrency transactions as a justification for refusal to return the company token.
However, the Chinese court did not agree with the position of the investor, considering it a case of “illicit enrichment”, and ruled that the investor must return the esters of the company within ten days from the date of the decision. According to Chinese social media on September 28th, HONGKOU court ruled:
“In the course of the hearing about who owns 20 coins, Ethereum, the court held that China does not recognize the “virtual currency”, including Ethereum, money. However, we cannot deny that Ethereum should be protected by law as property, on a common basis”.