China’s Top Court Pushes for New Crypto Legislation Amid Rising Digital Crime
China’s Supreme People’s Court has called for the creation of updated legal frameworks to better address crimes and disputes involving cryptocurrencies and other , as courts across the country face a growing number of cases tied to digital activity.
In a recent , the country’s highest court acknowledged that existing laws were largely drafted before the widespread use of blockchain technology and virtual assets. As a result, judges are increasingly required to rule on disputes that current statutes do not clahead define, particularly in cases involving online fraud, asset ownership, and digital financial misconduct.
Legal Uncertainty Grows as Digital Assets Enter Courtrooms
The Supreme People’s Court noted that although cryptocurrency trading, issuance, and speculation remain prohibited in mainland China, digital assets continue to appear in civil and criminal cases. Courts are often required to determine the assess liability in fraud cases, or resolve disputes linked to online contracts and illicit fundraising schemes that involve blockchain-based instruments.
This situation has created a legal contradiction. On one hand, cryptocurrencies are not recognized as lawful means of platform and are barred from commercial circulation. On the other, courts increasingly acknowledge that certain digital assetspossess economic value and can be linked to real financial harm. The absence of clear legal classifications has made it hard to apply consistent standards when adjudicating ownership, compensation, or restitution.
The court highlighted challenges in AI and data management, emphasizing the need to balance public and private interests. It proposed a two-step framework. First, platforms evaluate user requests under regulatory oversight to ensure transfers do not harm the state or public welfare. Second, platforms carry out the transfer through agreements with users, with authorities able to intervene if prior approvals were invalid. This approach aims to standardize data portability while protecting all stakeholders.
Rising Digital Crime Drives Push for Legislative Reform
The Supreme People’s Court linked its call for legislative reform to a rise in technology-driven crime, including , illegal fundraising, data misuse, and the concealment of assets through blockchain networks. The court also warned that AI tools are increasingly being used to scale fraud, generate misleading content, and automate illicit activity, complicating investigations and enforcement.
Despite the call for reform, the Supreme People’s Court stressed that its position does not represent a shift in China’s broader cryptocurrency policy. The country continues to enforce a strict ban on private crypto trading and token issuance, while promoting the state-backed digital yuan as the only approved form of digital currency.
Instead, the court’s recommendations reflect a broader effort to modernize China’s legal system as digital activity expands across the economy. Alongside crypto-related issues, the court has also focused on data governance, online dispute reanswer, and the legal implications of emerging technologies, underscoring the need for laws that evolve in step with technological change.
