In a significant development reflecting shifting legal perspectives, multiple prominent Chinese legal scholars have publicly affirmed that Bitcoin possesses property attributes and should be classified as a virtual commodity deserving legal protection. This landmark stance emerged during a high-level academic forum held in late April by the Nanjing People's Procuratorate and the Jiangsu Provincial Law Society’s Case Law Research Association, focused on the judicial recognition of cryptocurrency as a criminal law object.
While China maintains a strict ban on cryptocurrency trading and mining activities—officially declared in 2021—the growing number of thefts, frauds, and disputes involving digital assets has intensified legal debate over their status. The recent forum signals a nuanced evolution in judicial thinking: even if Bitcoin is not legally recognized for financial transactions domestically, it may still be protected under civil and criminal law due to its undeniable economic value.
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Bitcoin as a Virtual Commodity: A Growing Legal Consensus
Despite the absence of formal legalization, several legal experts at the forum emphasized that Bitcoin meets the essential criteria of property—scarcity, exclusivity, transferability, and economic value.
Zhou Ying, Deputy Procurator at Nanjing Xuanwu District People’s Procuratorate, stated:
“Bitcoin qualifies as a specific type of virtual commodity with clear property attributes. Accepting Bitcoin as a bribe should therefore constitute the crime of embezzlement. Although domestic trading is deemed an illegal financial activity, Bitcoin circulates internationally and can be exchanged for fiat currency through direct peer-to-peer transactions—even within China via informal channels.”
He further compared Bitcoin to "gold 2.0," noting its similarities with precious metals in terms of liquidity, scarcity, immutability, and privacy. With eight countries already approving Bitcoin spot ETFs—including the U.S. and several European nations—this analogy gains increasing traction in both financial and legal circles.
Judicial Precedents Acknowledge Cryptocurrency's Value
Gu Zhilong, Associate Professor at China University of Political Science and Law’s Institute of Cyber Law, highlighted existing court rulings that implicitly recognize virtual currency as property.
“The Supreme People’s Court’s newly launched case database includes at least four judgments acknowledging the property nature of cryptocurrencies. Three involve fraud or illegal fundraising cases where USDT (Tether) was treated as recoverable assets. Another case, a robbery trial, affirmed Bitcoin’s status as property.”
These precedents suggest a practical shift in enforcement: while public trading remains prohibited, courts are increasingly willing to treat digital assets as valuable property when resolving disputes or prosecuting crimes.
This distinction is crucial. As Gu explained, “If individuals use cryptocurrency in private transactions, civil and criminal laws must provide corresponding protections to maintain social order and justice.”
Legal vs. Criminal Treatment: Not Mutually Exclusive
Peking University Law School professor Che Hao offered a key clarification: the civil invalidity of cryptocurrency transactions does not automatically negate their relevance under criminal law.
“There’s no essential definition yet for whether digital currencies are property under Chinese law. But they aren’t banned like drugs or weapons—they’re not contraband. In reality, people trade them; they hold value. That functional reality supports their classification as property when it comes to crimes like theft or fraud.”
His view underscores a critical legal principle: something can be regulated or restricted without being valueless or unprotected. Just as black-market goods can still be stolen (and theft prosecuted), the illicit nature of certain Bitcoin transactions doesn’t erase their economic substance.
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Pricing Cryptocurrencies in Legal Proceedings
One major challenge in prosecuting crypto-related crimes has been valuation. Without official exchange rates or domestic pricing mechanisms, how should courts determine the value of stolen or laundered Bitcoin?
Li Yong, Director of the Legal Policy Research Office at Nanjing People’s Procuratorate, addressed this directly:
“From a legal interest perspective, digital currencies clearly possess property characteristics. Their uniqueness and non-replicability prevent them from being merely categorized as data under computer crime statutes. In the digital age, using international market prices to assess cryptocurrency value is both reasonable and necessary.”
This approach aligns with practices in other jurisdictions, where exchanges like CoinMarketCap or Binance are cited in court documents to establish fair market value at the time of offense.
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FAQ: Understanding Bitcoin's Legal Status in China
Q: Is Bitcoin legal in China?
A: No. Trading, mining, and financial services involving Bitcoin are banned within mainland China. However, holding or using Bitcoin privately is not explicitly criminalized.
Q: Can I sue someone for stealing my Bitcoin in China?
A: Increasingly yes. While no law explicitly declares Bitcoin as property, multiple court rulings have recognized its economic value in cases involving theft, fraud, or robbery—allowing victims to seek remedies.
Q: Does the Chinese government support any form of cryptocurrency?
A: It opposes decentralized cryptocurrencies like Bitcoin but actively promotes its own central bank digital currency—the digital yuan (e-CNY)—as part of national financial modernization.
Q: Why do courts protect something that’s technically illegal to trade?
A: Because legality in one context (financial regulation) doesn’t negate value in another (criminal law). Stolen goods retain value regardless of how they were acquired.
Q: Could this lead to partial legalization of crypto in China?
A: Full legalization remains unlikely in the short term. But these legal discussions may pave the way for clearer frameworks around inheritance, taxation, or dispute resolution involving digital assets.
Q: Are stablecoins like USDT treated differently than Bitcoin?
A: In practice, some courts have shown greater willingness to recognize stablecoins due to their pegged value and widespread use in cross-border transactions—even though they fall under the same regulatory ban.
Toward a New Framework for Digital Assets
The forum reflects an emerging consensus among China’s legal academia and judiciary: digital assets have real-world value and deserve legal recognition—even within a restrictive regulatory environment.
While policy may not change overnight, these expert opinions signal a growing movement toward distinguishing between financial risk (which justifies regulation) and property rights (which demand protection).
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As global adoption accelerates and decentralized finance matures, China’s internal legal discourse could play a pivotal role in shaping how authoritarian-regulated economies balance innovation, control, and individual rights in the digital age.
For now, one thing is clear: whether embraced or restricted, Bitcoin and other virtual currencies are no longer just code—they are assets with consequences.