Guangdong High Court releases top ten Internet cases in 2021, including XIN coin virtual currency investment dispute case

Wu said that on February 22, the Guangdong High Court released the top ten Internet-related cases in the province's courts in 2021, including a virtual currency dispute case:

Basic facts of the case: XIN coin is a kind of encrypted virtual "currency". In July 2019, Wei and others formed Team A, Jiang and others formed Team B, and Zhang and others formed Team C, and jointly invested in XIN coins to obtain profits. Among them, the XIN coins invested by Wei and the other four were raised from retail investors, and the entrustment and fundraising activities took place outside China. In March 2020, Zhang deleted the private key kept by Team C, resulting in the inability to withdraw the XIN coins invested by the three teams. Wei and others sued Zhang and others for compensation for the economic loss of 11.9 million yuan for the loss of XIN coins.

The Guangzhou Internet Court held that XIN coins do not have the legitimacy of legal tender, and that investors' investment transactions of obtaining XIN coins through overseas fundraising and investing to obtain returns endanger public property safety, disrupt social and economic order, damage social public interests, violate public order and good morals, and are not protected by law. The losses caused thereby should be borne by the investors themselves, so all the claims of Wei and others were dismissed.

Typical significance: This case is a typical case of virtual currency. This case determined that the virtual currency investment and trading activities between the parties did not comply with relevant regulations and were invalid, and the losses caused by them were borne by themselves. It made it clear that illegal investment and financing activities are not protected by law, and that investment and financing activities that damage the status of legal currency are not protected by law. It maintains the stability of the financial order, protects the safety of economic property, and safeguards the public interest in accordance with the law.