The Pricing Dilemma of Virtual Money in Judicial Practice

In recent years, the number of criminal cases related to Virtual Money has shown an upward trend. In addition to the common cases involving Virtual Money for money laundering, fraud, pyramid schemes, and gambling, cases of fraud and theft involving Virtual Money between individuals are also on the rise. These cases provide valuable references for handling criminal cases involving Virtual Money.

This article will explore how to determine the value of the virtual money involved in criminal cases related to virtual money by analyzing a virtual money fraud case triggered by a personal investment dispute.

Case Summary

From June to July 2018, Zheng deceived Wang under the pretext of assisting him in investing in blockchain projects, obtaining 32 coins and over 1000 Ether from Wang. Zheng sold the acquired coins, making a profit of over 1.64 million yuan. Later, after being notified by the police, Zheng voluntarily surrendered.

The court found that Zheng had fabricated facts to fraudulently obtain property from others with the aim of illegal possession, and the amount involved was particularly huge, constituting the crime of fraud. Zheng was ultimately sentenced to ten years in prison and fined 200,000 yuan.

The Court's Attitude Towards the Pricing of Virtual Money

When dealing with fraud or fundraising fraud cases involving Virtual Money, determining the amount involved is a key issue. In practice, judicial authorities have used various methods, such as the purchase price paid by the victim, the price at which the suspect sells the stolen goods, the market price of overseas exchanges, or the evaluation price from third-party institutions.

However, the Chaoyang District Court of Beijing clearly stated in this case: "The value of virtual money is influenced by national laws and regulations as well as industry regulatory policies, and it is not appropriate to directly determine it in individual cases." This viewpoint may become the current most standard adjudicative criterion. Ultimately, the court regarded the amount involved in the case as the proceeds of crime from the defendant Zheng's selling of stolen goods, which amounted to more than 1.64 million yuan.

Virtual Money Policies and Practical Dilemmas

On September 15, 2021, a notice jointly issued by ten ministries and commissions of the state regarding "Further Prevention and Handling of Risks in Virtual Money Trading and Speculation" classified activities related to Virtual Money as "illegal financial activities," which include providing information intermediary and pricing services for Virtual Money trading.

This policy has sparked controversy in practice. Some viewpoints argue that the judicial authorities or their entrusted third-party institutions determining the price of the virtual money involved in the case constitutes judicial activity and should not be restricted by this notice. Other viewpoints believe that this notice imposes comprehensive prohibitive regulations on activities related to virtual money, without exempting judicial activities, thus the pricing behavior of judicial authorities or third-party institutions may still violate regulatory policies.

Discussion of Solutions

To address the issue of value determination of the involved virtual money, the approach taken by the Chaoyang District Court in Beijing is worth referencing: Generally, it does not take the initiative to determine the value of the involved virtual money. In cases where there is an amount from the sale of stolen goods, the amount from the sale of stolen goods is prioritized to determine the involved amount. If there is no amount from the sale of stolen goods, the determination can be made in the order of the purchase price of the involved virtual money, the amount converted into cash, judicial appraisal, or evaluation amount.

Only when it is impossible to determine the amount involved in the case through other means, and the amount is crucial for conviction and sentencing, will the judicial authorities actively price the virtual money involved in the case.

Conclusion

The special nature of Virtual Money has led to many controversies at the legal level. This dilemma partly stems from the limitations in regulators' understanding of Virtual Money, as they attempt to comprehensively control it through simple regulatory documents, which not only fails to achieve the desired effect but also brings numerous challenges to law enforcement and judicial activities.

To completely solve this issue, it may be necessary to revise the existing policies. How to revise and the specific content of the revisions still need further discussion and research.