Cryptocurrencies have been included under a new Chinese civil code of ownership
Cryptocurrencies are recognised as properties that can be inherited under the Civil Code of the People’s Republic of China
Last Thursday, in the third session of the 13th National People’s Congress (NPC), China voted on and passed the Civil Code of the People’s Republic of China. Apart from general and supplementary provisions, the civil code also has six parts on real rights, contracts, personality rights, marriage and family, inheritance and tort liabilities.
The decision to proceed with drafting a civil code was announced in October 2014 and the legislative process began in June 2016.
Xinhua News Agency reported that the new civil code “states that the property rights of individuals are equally safeguarded to those of the State and collective, and online virtual assets are protected, too.”
Vice-Chairman of the Standing Committee of the National People’s Congress, Wang Chen, informed the session that the completion of the civil code “is an important component of the plans of the Communist Party of China (CPC) Central Committee with Comrade Xi Jinping at the core for developing the rule of law.”
The new civil code will be implemented on January 1, 2021.
Cryptocurrencies are now covered by inheritance laws. The new civil code stipulates that “virtual assets, such as bitcoins, can be inherited,” similar to all other properties that have been legally acquired by a natural person.
Aside from acknowledging cryptocurrency in the civil code, its very existence is a significant milestone for the country.
“The civil code is the first law to carry the title ‘code’ for the People’s Republic of China. It lays down the fundamental principles and regulations regarding civil activities and relations. It reflects the will of the people and protects their rights and interests.” Wang Liming was quoted to have said.
Liming is the Executive Vice President of the Renmin University of China and a law professor.
Several Chinese courts have also ruled cryptocurrencies as property that should be protected by law. Some examples include the Shanghai No. 1 Intermediate People’s Court, which ruled that Bitcoin is an asset protected by law. In another case, the Shenzhen Futian District People’s Court ruled Ethereum as a legal property that has economic value.
In addition, China is working on issuing the digital Yuan, its own digital currency. While there is no timetable for its launch, it is already being tested by select government officials in the country.
The Governor of the People’s Bank of China (PBOC) Yi Gang revealed that internal pilot tests have also been carried out in several cities to verify the theoretical reliability, system stability, convenience, applicability and risk controllability of the digital currency.