The Legality of Bitcoin in India and China
The crypto will remain legal in India while the government works on the regulations, a minister on the industry said.
In response to a request for clarity on the State’s opinion on the cryptocurrency, Anurag Thakur, Minister of State for Finance and Corporate Affairs of India, firmly denied that any token was illegal.
The comments contradict the content of an alleged bill that emerged last week, which described plans for a general ban on cryptocurrency and prison sentences for its use. The document, which appeared online from a local lawyer, seemed to form the basis of the consultations with Thakur, who, however, did not make explicit reference to its content.
“No, sir,” he answered when asked if the government “has banned cryptocurrency.”
“Taking note of the issue, the Government has set up an Interministerial Committee (IMC) under the chairmanship of the Secretary (EA). The IMC has presented the Report to the Government “, he continued.
India continues to be in a state of flux following highly mixed messages from the authorities and the central bank.
In July 2018, the Reserve Bank of India (RBI) prohibited banks from providing services to cryptocurrency companies, which caused the closure of some and the exodus abroad of others.
The bill, which has not been recognized, made additional reference to the creation of a digital rupee, which they said would become the only national digital currency legally allowed in India. Meanwhile, the industry has tried to override the RBI’s ban through the courts, a process that seems to have had multiple delays.
In short, Thakur set a cautious tone, which indicated that the existing rules applied to the cryptocurrency, while Delhi analyzed new regulations. “Currently, there is no separate law to deal with problems related to cryptocurrencies. Therefore, all departments and agencies in charge of enforcing the law, such as the RBI, the Compliance Department and the Income Tax authorities, etc., take measures according to the relevant laws in force, “he confirmed. In addition, in view of the risks and dangers associated with cryptocurrencies, the government and RBI have been issuing notices, press releases and circulars to the public. His words were warmly welcomed by the local cryptocurrency industry, and Nischal Shetty, WazirX exchange CEO, said the government was “taking careful measures”.
The government saw a direct reaction when the bill came up, and investor Tim Draper openly called it “pathetic and corrupt” for allegedly suggesting the ban.
For its part, Chinese Court confirms the legality of ownership of Bitcoin, BTC is protected by China’s property laws. A court in Hangzhou, China, confirmed the status of Bitcoin as “virtual property”. The ruling reaffirms that Bitcoin is legal to own in China. The first Bitcoin property infringement case was settled in the Hangzhou Digital Court. The local court confirmed that the Chinese legal system recognizes Bitcoin as “virtual property” with legal protections.
In 2013, the plaintiff bought BTC 2,675 for 20,000 yuan in a store in Taobao, China’s main online market, allegedly operated by the defendant, Shanghai Technology Company. In 2017, the plaintiff wanted to access the funds and found that the store was closed and could not contact the operator to obtain possession of his Bitcoin. The plaintiff alleges that when the store was closed, the operator, Shanghai Tech., Did not give notice.
Given the demand, the cryptocurrency trade was prohibited in China and, therefore, prohibited in Taobao. Then, Taobao failed to comply with its audit obligations when the Chinese authorities examined them, which probably led to the sudden closure of the stores that offered the cryptocurrency.
Taobao, in compliance with its legal responsibilities, was obviously not responsible for the losses of the claimant, according to the court. Even though the plaintiff lost the case, the local court still made an important decision about Bitcoin.
Although it has been, and still is, legal to own Bitcoin in the country, the case provides additional precedence for future rulings. «Bitcoin owns property attributes. It is valuable, scarce and disposable. Therefore, we must recognize it as virtual property according to the General Civil Law. The virtual property is legally protected by the laws of the People’s Republic of China ».
An important distinction is that facilitating Bitcoin’s trade and mining remains illegal in China. The case has a historical importance in terms of recognizing the legality of ownership of the digital asset in one of the largest Bitcoin markets.
Disclaimer: This press release is for informational purposes information does not constitute investment advice or an offer to invest. The views expressed in this article are those of the author and do not necessarily represent the views of infocoin, and should not be attributed to, Infocoin.