Written by: Martin
Recently, the Shanghai No. 2 Intermediate People's Court, in collaboration with relevant units, held a seminar on criminal cases involving virtual currency. Important consensus was reached regarding the legal characterization of behaviors related to virtual currency. Among the conclusions, the determination that "individual holding and trading of virtual currency generally does not constitute the crime of illegal business operation" provides clear guidance for judicial practice and market conduct.
Through the analysis of typical cases, the seminar clarified the core boundary between criminal and non-criminal acts. For example, in one case, Li Mou bought low and sold high on domestic and foreign platforms, earning tens of millions in price differences. The court held that if his actions merely constituted personal arbitrage and did not provide operational services to the public, they would not constitute the crime of illegal business operation. This determination emphasizes that establishing the crime of illegal business operation requires strict adherence to the characteristics of "business operation," necessitating comprehensive consideration of key elements such as whether the activity is profit-driven and whether it continuously provides services to non-specific parties.
Simultaneously, the seminar also delineated legal red lines: knowingly assisting others in illegal foreign exchange transactions through virtual currency conversion, if the circumstances are serious, will be recognized as an accomplice to the crime of illegal business operation; providing foreign exchange services to non-specific clients using virtual currency as a medium and charging fees is essentially an illegal "underground banking" activity and should be subject to criminal liability according to law.
The conclusions of this seminar reflect judicial prudence, avoiding excessive criminal intervention in normal individual investment and arbitrage activities while precisely cracking down on illegal and criminal acts that use virtual currency to disrupt financial order. It is important to note that virtual currency does not possess legal tender status, and related transactions carry civil risks; investors must still bear transaction losses themselves. The judicial authorities' refined definition of behaviors related to virtual currency delineates boundaries for market entities and promotes the uniform application of law in cases involving virtual currency.
