Bitcoin Impact Unlikely as Chinese Legislators Draft 'Virtual Property' Law

Reports that a new Chinese draft bill would cover digital currencies appear exaggerated, according to local sources.

Jun 29, 2016 at 12:40 p.m. UTC
Updated Sep 11, 2021 at 12:21 p.m. UTC

The National People’s Congress, the national legislature of China, has released draft text for a civil law code that, if implemented, would provide a legal definition for virtual property.

Following the announcement yesterday, reports began emerging that the definition could extend to blockchain-based assets including bitcoin and other digital currencies, with such speculation being set off by communications from local OTC trading firm BitKan.

However, Broad and Bright partner Roland Sun, a legal lead for blockchain consortium ChinaLedger, is now asserting that the text in question contains no specific reference to digital currencies or bitcoin, a fact other local sources indicated.

In interview, Sun said the law is rather designed to address longstanding disputes related to the theft of properties available in online gaming.

Though he acknowledged the definition could be expanded to include digital currencies, he said there is a "long way to go" before such a legal definition could be enacted.

Sun told CoinDesk:

"I don’t expect a firm legislative recognition of the property rights of cryptocurrency [holders] in the next five or six years."

However, he said it is "a matter of time" before Chinese lawmakers will need to make a decision on how to classify digital currencies, thereby following in the footsteps of regulators in the US, Australia, the UK and Japan that have been among the more progressive internationally on the issue.

Founded in 2016, ChinaLedger is a research and development consortium spearheaded by Wanxiang Blockchain Labs and focused on blockchain technologies.

Chinese law image via Shutterstock

Correction: An earlier version of this article incorrectly spelled 'BitKan' as 'BitKhan'. This article has been updated accordingly.

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