China has long banned cryptocurrencies and Bitcoin mining which took a toll on the industry. However, we are past that phase, and the markets have recovered from the ban. But now, a Chinese court unbans crypto trading for its citizens in a case that involved Litecoin. The court also said that crypto should not be used as a legal tender in any case.
Is crypto trading returning to China?
A lot of Chinese courts have given rulings that are not aligned with the ban that happened in 2021. Recently, a case that involved a Litecoin loan and interest payments called for unbanning crypto for trading purposes. However, using it for making payments or as a legal tender is still restricted. The case had an investor Zhai Wenjie who lent 50,000 LTC to Ding Hao in 2015. Zhai claimed that the agreement was that Hao had to pay him 1,000 LTC every month as interest. However, Hao refuted the claims.
The judge said that they could not consider Litecoin as a currency based on the restrictions and lack of any backing from financial institutions. There are also no rules that term LTC as an illicit asset, so the judge ordered Ding Hao to return the borrowed coins after the plaintiff gave evidence.
This means citizens can now trade Litecoin in the country, as the court hasn’t given any ruling against that. Even a Shanghai court has ruled that Bitcoin has an economic worth and is projected by national law.
Chinese miners can now become validators
Even though BTC mining will still not be possible in China due to the high energy usage and the authorities cracking down on miners, Ethereum has opened up new doors. Since the energy usage for validating ETH is nothing compared to POW mining, miners in China can become validators in the network without being caught. The government will not be able to track individuals who are validating ETH because it will not show up on the grid as high energy usage. This opens up a new opportunity for Chinese citizens.
What are your thoughts as a Chinese court unbans crypto trading? And do you think the Chinese authorities could unban crypto trading again? Let us know in the comments below. And, if you found our content informative, do share it with your family and friends.
Also Read: Michael Saylor talks about the misconceptions surrounding Bitcoin.