Virtual Money Judicial Disposal: Challenges and Innovations

Recently, an article titled "Disposal of Virtual Money Involved in Criminal Cases: Challenges, Innovations, and Judicial Responsibility" has attracted attention within the industry. The article, written by staff from the Shenzhen Intermediate People's Court, discusses the issues related to the disposal of virtual money in judicial practice. Although the article's technical discussion is somewhat superficial, it still holds certain reference value as a viewpoint from a judicial institution.

Main Points of the Article

The article first introduces the basic concepts, characteristics, and trading methods of Virtual Money. Subsequently, based on the relevant regulations from the central bank and seven ministries of the state, it points out that there is a lack of legal trading platforms and evaluation rules for Virtual Money in our country. The author believes that the characteristics of Virtual Money pose many challenges in handling criminal cases, such as difficulties in evidence collection, value determination, and disposal and realization issues.

It is worth noting that the article states that judicial practice generally recognizes that Virtual Money has property attributes. However, this view contradicts the current civil judicial practice. Currently, courts usually do not accept civil dispute cases involving Virtual Money.

The article also mentions the practices of Futian District in Shenzhen regarding the custody of the involved virtual money, but such practices have become relatively common nationwide. For virtual money that needs to be refunded or confiscated, the author suggests exploring the option of entrusting third-party institutions to liquidate it in compliant overseas exchanges after filing with the relevant departments, and then transferring the funds to the court's foreign exchange account.

Opinion Analysis

1. The recognition of the property attributes of virtual money varies between civil and criminal judicial practices. There is a general consensus on its value in criminal cases, while there are still disputes in civil cases.

2. The seizure of the virtual money involved adopts the "property stagnation, information flow" model, which mainly stems from the judicial authorities' unfamiliarity with the technical operations of virtual money.

3. Regarding the suggestion of entrusting third-party institutions to handle liquidation abroad, there are certain obstacles. Currently, domestic regulations prohibit any institution from engaging in the exchange of Virtual Money for fiat currency, making it difficult to determine which institutions possess the relevant qualifications.

4. The feasibility of the court opening foreign currency accounts to receive overseas Virtual Money disposal funds is worth discussing. According to current regulations, the purposes of foreign exchange accounts opened by the court are strictly limited, making it difficult to apply to Virtual Money disposal operations.

5. For privacy coins that threaten national security and public interest, destruction may not be the best option. Taking Monero as an example, its supply is unlimited, and destruction may actually lead to a decrease in market circulation, resulting in a price increase.

Future Outlook

The judicial disposal issue of virtual money essentially stems from domestic policies restricting the exchange of virtual money with fiat currency. If relevant policies can be adjusted in the future to allow for the establishment of compliant virtual money trading institutions domestically, it will greatly simplify the disposal process of the virtual money involved in cases.

At present, the disposal of the involved virtual money still faces many challenges. Judicial authorities need to continuously explore innovative disposal methods within the existing legal framework to adapt to the new problems brought about by technological development. At the same time, relevant departments also need to further clarify the legal status of virtual money to provide clearer guidance for judicial practice.