A court within Hangzhou City in China has recently ruled that a bitcoin miner who refused delivery must pay for the purchases despite the buyer’s allegation that the seller violated the crypto ban in China.
This is the first case of its kind regarding a dispute about bitcoin mining machine transaction in China.
In January 2018, the bitcoin miner surnamed Chen pre-ordered 20 units of crypto mining machines from an online platform and made the full payment of 612,000 yuan (roughly $88,000) in advance.
While after studying relevant regulations on bitcoin in the country, especially the ban on ICOs issued last September, Chen sent a refund application to the firm on February 3. The platform then refused his request to return the funds and later shipped all the pre-ordered mining rigs in March. Chen refused and returned the mining machines when they were delivered to him. At the same time, he submitted another refund application on the platform, which was rejected again.
After that, he brought a lawsuit against the firm to Hangzhou Internet court that specializes in handling Internet-related cases, claiming the firm has operated in violation of the ICO ban in China and its businesses of transactions on bitcoin mining machine should not be protected by laws.
The court held that the sales contract of bitcoin mining machines concluded by the plaintiff and the defendant, in the form of data messages through the Internet, was legally established.
“In this case, the subject matter of the transaction, “mining machine”, as a kind of hardware specially used to calculate and generate bitcoin, has property nature itself. Laws and regulations in China have not yet prohibited the production, possession and legal circulation of bitcoin, nor have they banned the buying and selling of bitcoin mining machines.” As such, the court denied his appeal.
Bitcoin has been ruled out as currency by the country’s central bank, but its tight connection to money has given rise to quite a number of disputes these years. As a previous report by 8btc, Beijing court has sided with crypto exchange and ruled that the bitcoin trader should repay the 5 bitcoins sent in error to the crypto exchange in spite of the allegation that the exchange violated the crypto trading ban.
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