A Chinese court in the city of Hangzhou said collections of non-fungiable tokens (NFTs) are online virtual properties that must be protected under Chinese law. Here are the details of the decision taken for the NFT area, where many altcoin projects take place.
Decision made on NFTs in China
Hangzhou Internet Court, a specialist internet court, issued a decision on November 29. Also, an article shared by crypto blogger Wu Blockchain on Dec. 5 reveals the appropriate language for NFTs after the country began tightening its cryptocurrencies in 2021, leaving NFTs in the gray zone. When translated, the article states that NFTs “have the object properties of property rights such as value, scarcity, controllability, and tradability.” As a result, he says, these are “virtual network property” that “must be protected by China’s law.”
The Hangzhou Court of China pointed out that NFT digital collections have the characteristics of value, scarcity, controllability, and tradability, and belong to online virtual property, which should be protected by Chinese laws. https://t.co/VONcSp0319
— Wu Blockchain (@WuBlockchain) December 5, 2022
The court ruled that a lawsuit required “confirmation of the legal qualifications of the NFT collection”. He acknowledged that “Chinese law currently does not explicitly stipulate the legal qualifications of NFT collections.” The court ruling pointed to a user of a tech platform, both of which are anonymous. He pointed out that he refused to complete a sale because the user gave a name. It was therefore alleged in a lawsuit that he sued the company for canceling the NFT purchase “from flash sale”.
“NFTs epitomize the original art expression of the creator and have relevant intellectual property rights value,” the court said. He added that NFTs are “unique digital assets created on the Blockchain based on the trust and consensus mechanism between blockchain nodes.” Therefore, the court said that “NFT digital collections fall under the category of virtual property.” It was stated that the transaction in the case was seen as “selling digital products over the internet”. In addition, the area should be regulated by the e-commerce business and the “e-commerce Law”.
Bitcoin also has property rights
This comes after the Shanghai Supreme People’s Court issued a document in May stating that despite the country’s crypto ban, Bitcoin is similarly subject to property rights laws and regulations. With its crypto ban, China has sought to separate NFTs from crypto with a government-backed blockchain project to support the distribution of fiat-paid NFTs.
The government is still on the alert to ensure that its people resist “NFT speculation.” This issue was also addressed in a statement shared by the China Banking Association, the China Internet Finance Association, and the China Securities Association. This was noted in a joint statement issued in April that warned the public of the “hidden risks” of NFT investing. China is not the only jurisdiction that subjects NFTs to property laws. As we reported on cryptokoin.com, a Singaporean Supreme Court judge compared NFTs to physical properties such as luxury watches or fine wine in an October lawsuit. “NFTs originated as a collector’s item,” he said, taking advantage of existing property laws.
What are the altcoin projects in the NFT space?
So, what are the prominent altcoin projects in the market in question? As the largest NFT coins by market cap, we can show Apecoin (APE), Flow (FLOW), Chiliz (CHZ), Tezos (XTZ) and The Sandbox (SAND).
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