An article published by the Beijing Arbitration Commission says that Bitcoin has never been banned in China as a commodity; the control over Bitcoin is working in a very different way.
China Recognizes Bitcoin as Commodity
The Beijing Arbitration Commission made an article on which recognizes Bitcoin as a commodity and its legal nature in China. The Beijing-based independent, non-profit organization offers services in arbitration, mediation, and other dispute resolution mechanisms.
The article was authored by economist Wang Jin, an arbitrator for the commission. Wang said in the article that the current control over the rules and policies of Bitcoin is properly based on a statement issued by the people’s Bank of China and a group of ministries in 2013. On Sept. 4, 2017, seven ministries and also the people’s bank of China explained that Bitcoin is not a legal tender. Besides, they say Bitcoin is a commodity, not a digital currency. That is the way China thinks of Bitcoin and other related currencies.
Has Bitcoin constituted money in China?
In the report, the BAC stated that China is legal regarding cryptocurrencies like Bitcoin and outlined major crypto-related activities. According to the BAC, China prohibits token funding, and trading platforms from engaging in exchanges between the legal tender, and virtual currency or tokens.
The commission then states that the law bans cryptocurrency also recognizes it as a virtual commodity. Existing laws are, according to the BAC, still not enough to accept Bitcoin as a regulated virtual item.
“The General Principles of Civil Law are not specific in connotations of virtual property, in fact, they only speculate that the virtual property is and must be checked by law. Do not make specific provisions on the extension and connotation of virtual property[u1] ”.
Some Banned operations include the move on which Bitcoin is used as a currency. Bitcoin must be a non-engaged item in matters of currency operations. It is the only way that bitcoin can survive without restrictions in China.
A good example of this is that Bitcoin is only used as general property and this way the currency does not violate the regulations and gets more validation.
China Prioritizes Blockchain Development
China is known for its solid rules and policies regarding crypto; some regulations related to crypto exchanges emerged in 2017. One perfect example of this is the exit of Binance, which was originally rooted in China.
China has not stated restrictions and prohibitions against cryptocurrency. Chinese authorities claimed that Bitcoin mining will not be part of any illegal practice in the whole country. The Chinese government is very well-known for being very strict regarding policies that prioritize blockchain development. This call to action was made by President Xi Jinping in 2019.
Alongside aggressive blockchain developments, China’s central bank has progressed in parallel works with its central bank digital currency. In April 2020 a very potential project was developed in several countries.
By Jenson Nuñez