China Supreme Prosecutors Rule Bitcoin Is Protected Property Amid Ban
China’s Supreme People’s Procuratorate (SPP) published a June 7 case where prosecutors in Qingdao argued that Bitcoin is “legally protected property” under Chinese criminal law. The ruling sentenced a defendant (Zhang) to 10 years and 9 months and fined him 100,000 yuan for stealing 107 Bitcoin by obtaining the victim’s wallet recovery phrase, then transferring and liquidating the holdings. Prosecutors treated Bitcoin as property because it has demonstrable economic value and can be exclusively controlled by the owner.
The decision highlights a direct tension with China’s five-year-old blanket crypto ban. In 2021, regulators declared all cryptocurrency transactions illegal, and in May 2026 the crackdown expanded to cover stablecoins, RWA tokenization, and offshore yuan-pegged digital currencies, with a two-year rectification deadline for unauthorized cross-border financial channels. Despite this, Chinese courts have repeatedly affirmed Bitcoin ownership in criminal proceedings, and now the SPP is effectively setting a nationwide template: when Bitcoin is stolen, it should be prosecuted as theft of property valued at market rates.
For traders, the immediate effect on BTC price is likely limited, but the ruling may strengthen the long-term “rule-of-law protection” narrative around Bitcoin—without changing China’s trading and transfer restrictions.
Neutral
This is a legal-ruling story rather than a policy-relief story. The SPP’s decision confirms that, in criminal proceedings, Bitcoin can be treated as protected property, which may reduce perceived “jurisdictional ambiguity” around BTC ownership in court. That can be a mild long-term positive for sentiment.
However, the ruling does not repeal China’s trading/transaction ban. In practice, traders still face operating constraints tied to enforcement risk. Similar “property recognition” precedents in restrictive jurisdictions have tended to support longer-term legitimacy narratives, but they usually do not immediately translate into spot demand because the accessibility and liquidity channels remain constrained.
Short-term, the market may react more to headline conflict (“ban vs protection”) than to fundamentals, leading to limited price impact. Longer-term, the clearer legal framing could support the view that Bitcoin retains distinct legal status compared with other tokenized assets—potentially benefiting BTC relative positioning if regulatory headlines continue to evolve. Overall, this points to neutral impact: sentiment support, but no direct removal of barriers that matter for trading flows.