On August 23 of last year, the Supreme People's Court publicly released 30 bidding topics to the society, among which included the judicial disposal of involved Virtual Money. At that time, Lawyer Liu specifically wrote an article for analysis (see: "New Trends in the Disposal of Involved Virtual Money, Now a Key Research Topic of the Supreme Court"). Recently, according to publicly available information, Renmin University of China is one of the winning units (Southwest University of Political Science and Law is also involved in the research of this topic).
Recently, a closed-door seminar on "Research on the Disposal of Involved Virtual Money" was attended by representatives from various agencies, including Professor Yang Dong from the Law School of Renmin University of China, Judge Chen Xinwang from the Third Criminal Division of the Supreme People's Court, and Engineer Ma Zhe from the Equipment Division of the First Research Institute of the Ministry of Public Security, as well as representatives from companies such as China Mobile Migu Company, Beijing Equity Exchange, Hong Kong Financial Trading and Services Limited, and Yun Account Technology (Tianjin) Co., Ltd.
What did the seminar discuss?
From the article "The Successful Holding of the Closed-Door Seminar on the Major Research Project of the Supreme People's Court's 2024 Judicial Research on 'The Disposal of Virtual Money Involved in Cases'", we can learn that the research on the judicial disposal of virtual money involved in cases by the research team of Renmin University of China is still ongoing. Professor Yang Dong, the head of the research team, stated that the team had previously conducted research in the United States.
The judge of the Criminal Division of the Beijing Third Intermediate People's Court stated that, under the premise of determining that virtual money has property attributes, there are challenges in aspects such as case qualification (involving coins), calculation of the amount of crime, and identification of the form of crime (to put it plainly, there is currently no established practical convention).
The Beijing Property Rights Exchange introduced the workflow and latest progress of joint disposal (see Lawyer Liu's previous article: "What is the 'new channel' for the disposal of virtual money involved in cases by the Beijing Public Security Bureau? Can disposal be opened now?").
Ma Zhe, an engineer at the Ministry of Public Security, believes that coordination between the courts and public security agencies in the execution phase is very important. He suggests using a "dual-trust mechanism" where independent entities both domestically and internationally undertake disposal tasks. For the custody of the virtual money involved in the case, security can be enhanced through performance bonds, cold wallets, and insurance arrangements.
The views of other experts will not be elaborated on by Lawyer Liu.
Are there any new developments in current disposal practices?
Through the content of this seminar, Lawyer Liu judges that the research conducted by the research team of Renmin University of China on the disposal of the virtual money involved in the case is still in the preliminary stage, and no conclusive viewpoints have emerged yet.
Whether it is the research group's investigation in the United States or the judges' viewpoints, they basically remain at the theoretical stage of scholarly type.
The Beijing Equity Exchange (referred to as "North Exchange") and the First Research Institute of the Ministry of Public Security have made new progress in practice. For example, a few days ago, the North Exchange and the Beijing Municipal Public Security Bureau signed the "Cooperation Framework Agreement on the Disposal of Involved Virtual Money Business", but according to the information obtained by Lawyer Liu, the actual disposal business is not directly carried out by the North Exchange, but is instead entrusted to a service company (i.e., a third-party disposal company) for handling.
The current disposal practice is still mainly based on joint disposal within and outside the country, with no significant changes. However, from Lawyer Liu's personal perspective, the push for disposal across the country has clearly slowed down this year, primarily due to local doubts about whether the virtual money involved in the case can be disposed of in compliance.
However, the "official announcement" from the Beijing Municipal Public Security Bureau may objectively promote the future disposal work across the country. This is because the Beijing Municipal Public Security Bureau should be the first to publicly detail its cooperation in the judicial disposal of the virtual money involved in the case.
The impact of the Supreme Court's research on the future disposal model
In the promotional article for the overview seminar, Lawyer Liu noted that the experts from the research group of Renmin University of China are focusing on the following points:
First, the judge of the civil court of the Beijing Third Intermediate People's Court mentioned that local courts face difficulties in handling cases involving coins. So, in the future, is there a possibility that the judicial authorities' handling will shift from being entrusted by the current public security organs to being entrusted by the execution bureau of the court?
Second, the disposal service fee needs to be further transparent. More than one participant expressed that the rationality of disposal prices and issues such as rate transparency should be the focus of future research.
Thirdly, inter-departmental cooperation mechanisms will become more common. On the commissioning side, in the future, at least cooperation will be needed from public security, courts, government finance departments, and even the central bank (local branches), and foreign exchange authorities (local branches); on the disposal side, under the mode of joint disposal both domestically and internationally, the final disposal and realization need to be conducted overseas. If legal disputes occur during the disposal abroad, cross-border judicial cooperation between overseas judicial authorities and mainland judicial authorities will also be required.
IV. Conclusion
Before the establishment of a national strategic reserve for Virtual Money in China, the Virtual Money seized by judicial authorities in the mainland will ultimately face disposal and liquidation; and before the "9.24 notice" is modified or abolished, no one in mainland China can conduct exchange operations between Virtual Money and fiat currency, and disposal still needs to be carried out overseas.
For the compliance of judicial disposal, both theoretical compliance demonstration and design are needed, as well as practical innovation and experimentation, especially for the judicial disposal of involved Virtual Money.
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New trends in the judicial disposal of virtual money in China, what did the Supreme Court's judicial research project say?
On August 23 of last year, the Supreme People's Court publicly released 30 bidding topics to the society, among which included the judicial disposal of involved Virtual Money. At that time, Lawyer Liu specifically wrote an article for analysis (see: "New Trends in the Disposal of Involved Virtual Money, Now a Key Research Topic of the Supreme Court"). Recently, according to publicly available information, Renmin University of China is one of the winning units (Southwest University of Political Science and Law is also involved in the research of this topic).
Recently, a closed-door seminar on "Research on the Disposal of Involved Virtual Money" was attended by representatives from various agencies, including Professor Yang Dong from the Law School of Renmin University of China, Judge Chen Xinwang from the Third Criminal Division of the Supreme People's Court, and Engineer Ma Zhe from the Equipment Division of the First Research Institute of the Ministry of Public Security, as well as representatives from companies such as China Mobile Migu Company, Beijing Equity Exchange, Hong Kong Financial Trading and Services Limited, and Yun Account Technology (Tianjin) Co., Ltd.
What did the seminar discuss?
From the article "The Successful Holding of the Closed-Door Seminar on the Major Research Project of the Supreme People's Court's 2024 Judicial Research on 'The Disposal of Virtual Money Involved in Cases'", we can learn that the research on the judicial disposal of virtual money involved in cases by the research team of Renmin University of China is still ongoing. Professor Yang Dong, the head of the research team, stated that the team had previously conducted research in the United States.
The judge of the Criminal Division of the Beijing Third Intermediate People's Court stated that, under the premise of determining that virtual money has property attributes, there are challenges in aspects such as case qualification (involving coins), calculation of the amount of crime, and identification of the form of crime (to put it plainly, there is currently no established practical convention).
The Beijing Property Rights Exchange introduced the workflow and latest progress of joint disposal (see Lawyer Liu's previous article: "What is the 'new channel' for the disposal of virtual money involved in cases by the Beijing Public Security Bureau? Can disposal be opened now?").
Ma Zhe, an engineer at the Ministry of Public Security, believes that coordination between the courts and public security agencies in the execution phase is very important. He suggests using a "dual-trust mechanism" where independent entities both domestically and internationally undertake disposal tasks. For the custody of the virtual money involved in the case, security can be enhanced through performance bonds, cold wallets, and insurance arrangements.
The views of other experts will not be elaborated on by Lawyer Liu.
Through the content of this seminar, Lawyer Liu judges that the research conducted by the research team of Renmin University of China on the disposal of the virtual money involved in the case is still in the preliminary stage, and no conclusive viewpoints have emerged yet.
Whether it is the research group's investigation in the United States or the judges' viewpoints, they basically remain at the theoretical stage of scholarly type.
The Beijing Equity Exchange (referred to as "North Exchange") and the First Research Institute of the Ministry of Public Security have made new progress in practice. For example, a few days ago, the North Exchange and the Beijing Municipal Public Security Bureau signed the "Cooperation Framework Agreement on the Disposal of Involved Virtual Money Business", but according to the information obtained by Lawyer Liu, the actual disposal business is not directly carried out by the North Exchange, but is instead entrusted to a service company (i.e., a third-party disposal company) for handling.
The current disposal practice is still mainly based on joint disposal within and outside the country, with no significant changes. However, from Lawyer Liu's personal perspective, the push for disposal across the country has clearly slowed down this year, primarily due to local doubts about whether the virtual money involved in the case can be disposed of in compliance.
However, the "official announcement" from the Beijing Municipal Public Security Bureau may objectively promote the future disposal work across the country. This is because the Beijing Municipal Public Security Bureau should be the first to publicly detail its cooperation in the judicial disposal of the virtual money involved in the case.
In the promotional article for the overview seminar, Lawyer Liu noted that the experts from the research group of Renmin University of China are focusing on the following points:
First, the judge of the civil court of the Beijing Third Intermediate People's Court mentioned that local courts face difficulties in handling cases involving coins. So, in the future, is there a possibility that the judicial authorities' handling will shift from being entrusted by the current public security organs to being entrusted by the execution bureau of the court?
Second, the disposal service fee needs to be further transparent. More than one participant expressed that the rationality of disposal prices and issues such as rate transparency should be the focus of future research.
Thirdly, inter-departmental cooperation mechanisms will become more common. On the commissioning side, in the future, at least cooperation will be needed from public security, courts, government finance departments, and even the central bank (local branches), and foreign exchange authorities (local branches); on the disposal side, under the mode of joint disposal both domestically and internationally, the final disposal and realization need to be conducted overseas. If legal disputes occur during the disposal abroad, cross-border judicial cooperation between overseas judicial authorities and mainland judicial authorities will also be required.
IV. Conclusion
Before the establishment of a national strategic reserve for Virtual Money in China, the Virtual Money seized by judicial authorities in the mainland will ultimately face disposal and liquidation; and before the "9.24 notice" is modified or abolished, no one in mainland China can conduct exchange operations between Virtual Money and fiat currency, and disposal still needs to be carried out overseas.
For the compliance of judicial disposal, both theoretical compliance demonstration and design are needed, as well as practical innovation and experimentation, especially for the judicial disposal of involved Virtual Money.