Will the attitude of allowing the country to hold BTC change?

Comparing the differences in regulation on digital tokens between China and other countries, it can be seen that there are different options for security-based tokens, which have the strongest financial attributes: one option is to outlaw them; the other is to strictly regulate them.

Will the attitude of allowing the country to hold BTC change?

It’s a morning in Beijing, pouring rain, and I’m at my desk reading everyone’s messages to the public, and my friends are concerned about whether the law will one day suddenly not allow the country to hold bitcoin. On this issue, Sara gives her personal opinion, not as investment advice.

Part 01

China’s model for regulating digital tokens

Readers are in the loop, so we won’t dwell on the specific technical features of blockchain and other crypto technologies. What is certain is: token incentive itself is also an important element of blockchain application, and some people even believe that token is the soul of blockchain application.

The legal evaluation of digital tokens in China is basically a “ternary theory”. Firstly, crypto technology is encouraged and promoted, and even the Cryptography Law has been enacted to protect it positively at the legal level; secondly, for digital tokens such as bitcoin and ethereum, which have appeared and been issued abroad before September 4, 2017 and have a large circulation, the attitude in judicial practice is different; thirdly, for the issuance of coins in China or the financing audience is mainly Chinese, they are all characterized as “illegal public financing” by the 94 announcement, and the corresponding tokens issued are also combated together.

Crypto technology itself has limited legal risks, mainly the crime of aiding and abetting, and may become a tool to help the tiger, so please be careful not to become an accomplice to other crimes.

Specifically, digital currencies developed and used based on blockchain and other crypto technologies have four legal outcomes in China.

The first one is the digital fiat currency ERMB, which is officially developed and currently on trial in major banks, with the endorsement of state coercive force and belongs to fiat currency, and no one can refuse to accept it (after the official launch, people and stores in the country must accept it).

The second is BTC Bitcoin, which was given a clear legal characterization in 2013. It coincided with the introduction of the Civil Code, article 127 of which explicitly protects the virtual property of Chinese people. Through the thesis of the legislator, Mr. Yang Lixin, we can learn that for virtual property is protected as property rights, and BTC is a virtual commodity (belongs to property). By concluding through the major premise and minor premise, it can be seen that BTC is a kind of virtual property that Chinese people can hold.

The third kind, the pass-through in the alliance chain, has been tried in the central enterprises, state-owned enterprises and private enterprises, and the application in supply chain finance is more mature. The law considers these tokens are a kind of intra-group right certificate, and the degree of compliance is higher.

The fourth is the ICO virtual coins, the basic attitude is outlawed, 94 announcement of the severity, so far let Zha Sister unforgettable, five o’clock that afternoon, the whole coin circle wind, then is three or four consecutive months of international migration, Zha Sister several old friends also bounced to Japan, Singapore, Australia, Canada and other countries.

Part 02

Coin-related regulation of other countries

Sister Za’s team summarized the regulatory schemes of the United States, Singapore, Germany and Japan. For blockchain and other crypto technologies, the attitude of the international community is basically positive, and officials of some countries even said that blockchain technology is the cornerstone of the future world.

Currently, there are also countries that are starting to experiment with digital fiat currencies, the legality of which is self-explanatory given their fiat currency status. What needs to be understood and discussed is what are the regulatory schemes in other countries for digital tokens other than fiat money?

Other countries around the world do not treat bitcoin as legally distinct from tokens such as ethereum. Instead, they have adopted a unified approach to regulating digital tokens, essentially adopting a “three-part approach”.

First, payment tokens, such as BTC, are used as a means of payment for goods or services.

Secondly, security-based tokens, which have financial attributes and are regulated by laws related to securities and financial derivatives.

Third, functional tokens, which are only applied to the issuer’s own network system, have a relatively closed nature, and authorize users to use the right to use products or services through blockchain technology.

For different types of digital coins, the laws used vary. Our examination found that between the three types of tokens, transformation occurs with time and circumstances, and the transformed tokens are regulated according to the type they belong to.

Part 03

Answer the question: How legal is it for national people to hold BTC

In academic articles, Sara will discuss the necessity of reviewing the unconstitutionality of various local notice opinions, but the public number still respects the platform requirements and does not cover related topics.

From Mr. Yang Lixin’s article, the right of Chinese people to hold virtual property is the right in rem, which is the highest civil right and cannot be arbitrarily deprived. At the same time, in a realistic sense, the nature of digital tokens is that both public and private keys are available. If the private key is always in the hands of the holder, theoretically, no super back office can take away one’s bitcoin (except for hackers). Even if holding digital tokens is prohibited in a literal sense, in practice 100% ownership of digital tokens is in the hands of the holder, making it difficult to actually ban them.

Throughout the history of China’s monetary development, private minting has long existed, and the Southern Song government even turned a blind eye to it, which some scholars believe objectively caused the effect of hiding wealth from the people.

In addition, we need to understand that the root cause of outlawing tokens is their financial attributes of “illegal public financing”, when P2P network lending platforms and equity crowdfunding caused double harm to personal property rights and the national financial order, leaving all parties in fear. Exchange has its fair price, there are also a large number of holders to support the price; but other tokens brewed later, a birth with securities financing function, which will be strictly regulated, some countries choose Howie test screening out of strict control, some countries to take outlawing methods.

Finally, BTC’s environmental issues are really worth studying, in order to protect the environment for bitcoin mining behavior to dispose of, responding to the social needs under the carbon neutral. However, Sara’s personal view is that this does not affect the Chinese holding of Bitcoin itself, an emerging right in rem of virtual property that will not be easily declared illegal.

Part 04

In the end

Comparing the differences in regulation of digital tokens in China and other countries, it is clear that the choices are different for security-based tokens, which have the strongest financial attributes: one option is to outlaw them; the other is to strictly regulate them. Readers may wonder why there is such a difference, Sara’s personal view is: the root cause is in the “Securities Law”, the connotation and extension of what “securities” are in the securities law of each country is different, resulting in some countries and regions, the private emergence of equal shares of assets or warrants can not be classified within the scope of securities. If the definition of securities is ever changed in the Securities Act, perhaps the regulatory schemes will converge across countries.

Today, only the administrative law level is addressed, and it is the different administrative regulatory schemes that directly lead to the differences in the types of cases involving currency-related crimes in each country.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/will-the-attitude-of-allowing-the-country-to-hold-btc-change/
Coinyuppie is an open information publishing platform, all information provided is not related to the views and positions of coinyuppie, and does not constitute any investment and financial advice. Users are expected to carefully screen and prevent risks.

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