Source: Burdun/AdobeTokens like Ethereum (ETH) and Bitcoin (BTC) continue to rest on difficult legal ground in China, where an ETH hacker who attacked in 2018 was recently sentenced to 10,5 years behind bars. But prosecutors across the country said it could be difficult to convict BTC thieves who struck after the 2021 crackdown.
According to a branch of the Guangxin District People's Court, an individual named Li used a virus-like program to hack into an ETH wallet belonging to an individual named Miao. Li then stole a total of 383,6722 ETH between March 2018 and April 2018.
Instead of stealing the entire stash in one go, however, Li made a total of 520 wallet withdrawal transactions, in each case exchanging the ETH funds for tether (USDT).
Police were able to recover funds worth 109 USDT from Li's wallets.
In addition to the prison sentence, the court fined Li approximately $28.000.
What is the legal status of BTC, ETH and Alts in China?
China has taken two crackdowns on cryptocurrencies. The first was in 2017, when exchanges were basically ordered to shut down and leave the country. The second was in September 2021, when Beijing told cryptocurrency miners to shut down their rigs and ordered banks to block cryptocurrency-related transactions.
Interestingly, perhaps, China has never attempted to ban BTC or criminalize cryptocurrency ownership. Clandestine crypto mining is believed to continue in many areas, while Cryptonews.com has seen evidence that over-the-counter (OTC) crypto trading, particularly in BTC and USDT, still takes place in many areas.
Bitcoin mining pool distribution data (as of 22/11/2022). (Source: BTC.com)The crackdown has created a host of new laws and guidelines, which have proven to be a headache for Chinese courts. In a new report from China's prosecutors, legal experts sought to determine whether BTC theft can still be prosecuted under Chinese law.
Their conclusions can be summarized as follows: In cases dating back to before September 2021, BTC was deemed to have certain ownership rights. As such, BTC theft could be punishable under the same type of laws that apply to physical (non-monetary) assets. But in cases where the hackers or thieves got away with it after that point, victims may find it more difficult to find justice.
Chinese law now states that BTC does not constitute property. Nor can it be considered a currency. Prosecutors therefore concluded that bitcoin theft "cannot be determined" to "constitute a crime" in China as it stands in November 2022.