A district court in Qingdao, China, has formally recognized Bitcoin as property under the country’s criminal law, setting a significant precedent in a case involving the theft of 107 BTC. The Licang District Court’s decision, reported by local media, clarifies that digital assets can be subject to theft prosecution despite China’s strict ban on cryptocurrency trading and mining.
The defendant, identified only by the surname Zhang, was sentenced to 10 years and 9 months in prison and fined 100,000 yuan (approximately $13,800). According to court documents, Zhang obtained the victim’s cryptocurrency wallet recovery phrase and used it to transfer and sell the stolen Bitcoin. Prosecutors successfully argued that Bitcoin meets the legal definition of property because it possesses economic value and can be exclusively controlled by an owner.
Valuation method sets important precedent. The court calculated the theft’s value based on the more than 660,000 yuan (over $91,000) that Zhang received from selling the Bitcoin, rather than its market price at the time of the crime. This distinction provides a practical framework for valuing stolen digital assets in future criminal cases.
The ruling aligns with earlier Chinese civil court decisions that recognized Bitcoin as property protected by law, even as the government maintains its sweeping 2021 ban on crypto trading. Legal experts note that this approach allows authorities to prosecute theft, fraud, and other crimes involving cryptocurrency without legitimizing it as a financial instrument. The decision also gives victims of crypto-related crimes a clearer path to seek justice and may encourage more incident reporting.
The case underscores the critical importance of securing recovery phrases, as a single compromised phrase can lead to total loss of funds. While the ruling offers a measure of legal protection for cryptocurrency holders in China, it does not signal any relaxation of trading restrictions.
