The latest update in the long-standing Chinese crypto ban saw the first ever case of Bitcoin mining contract where the verdict “invalidated” the claim and denied the plaintiff’s appeal for the refund of their “huge Bitcoin proceeds”.
Earlier today, Beijing’s Chaoyang Court sentenced the Nation’s first Bitcoin Mining Contract case as invalid, further confirming that any contract involving cryptocurrency and its mining will not be protected by law in China. Upon reaching the verdict against the plaintiff’s appeal, Chaoyang Court also submitted clues to relevant departments, including the Sichuan Provincial Development and Reform Commission, requesting an investigation of this illegal act, involving banned crypto activities in the country.
In Beijing’s first case involving a contract dispute of Bitcoin mining, the court ruled that the contract was invalid. This means that any contract involving cryptocurrency and the mining may not be protected by law in China. https://t.co/lpMksXviEW
— Wu Blockchain (@WuBlockchain) December 15, 2021
Bitcoin Mining Contract Case loses $955 Million
According to the plaintiff, Fengfu Jiuxin Company had signed a contract with the defendant, Zhongyan Zhichuang Company. The plaintiff provided Zhongyan Zhichuang Company with funds worth 1000 million Yuan to purchase Bitcoin Mining Equipment and further provide Bitcoin “mining” data value-added services, along with paying for value-added service benefits. However, the defendants have only paid 18.3463 Bitcoin to Fengfu Jiuxin Company as data value-added income, and have repeatedly failed to pay any benefits since then.
In accordance with the Plaintiff’s claims, the defendants owe them 278.1654976 Bitcoins, as well as compensation for the loss of the mining equipments occupied after the service expires. Furthermore, according to the market value of Bitcoin at the time of the lawsuit, the plaintiff demanded a total of $955 million. Nevertheless, the Chaoyang Court noted that both parties signed a Bitcoin mining agreement despite knowing the prevalent risk of crypto mining and trading, along with knowledge of nationwide ban on crypto trading. Henceforth, the court declared the agreement as invalid, thereafter, nullifying any relevant property rights and interests provided by the Chinese law in such cases.
The Chinese Crypto ban is rapidly taking over all arenas. Formerly, the country’s largest crypto exchange, Huobi also suspended all deposit and coin transactions for users in mainland China today. This could be marked as the official end of the decentralised industry in China.