China’s Supreme People’s Court announced that it will work on new judicial rules regarding virtual currencies and international finance cases. The institution also stated that it aims to prepare legal comments clarifying the compensation processes in cases involving the use of inside information and market manipulation as soon as possible. This development aims to introduce more specific standards on how courts should proceed in new disputes arising in the digital economy.
New challenges in the courts in the digital age
The Supreme Court emphasized that legal protection rules regarding artificial intelligence cases and data ownership are also on the agenda. More comprehensive case law guides will be prepared in areas such as data ownership, data exchange and the legal status of content produced by artificial intelligence. Liu Guixiang, a member of the court’s judicial committee, made the statement.
In the statement, it was emphasized that the aim is to increase inter-court harmony in resolving responsibilities and disputes in cryptocurrency and artificial intelligence-based intellectual property cases. These steps are expected to facilitate judicial processes for the increasing number of crypto and AI-related cases in China.
Mini dictionary: Pig butchering scam is a type of fraud in which investors are deceived into fake investment projects or crypto transactions, and they end up losing a large amount of their money. This term is used to emphasize that victims face serious financial losses.
The prominent case of the recent period: Chen Zhi
These studies came to the fore after the Chen Zhi case, which came to the fore in recent months. Chinese-born businessman Chen Zhi is known as the founder and chairman of Prince Group in Cambodia. Zhi was captured in Cambodia on January 6, 2026 and returned to China soon after. It was stated that the investigation launched against him focused on serious fraudulent activities called ‘pig butchering scam’. The US Department of Justice announced in October 2025 that it seized approximately $15 billion worth of Bitcoin from operations allegedly linked to Zhi.
Liu Guixiang, a member of the judicial committee of the Supreme People’s Court of China, stated that they are working on new legal regulations that will clarify both the jurisprudence and compensation processes in cross-border financial cases with virtual currencies.
China’s continued stricture on crypto regulations
China’s approach to cryptocurrencies has been quite strict for years. In 2013, the Central Bank of China introduced the first serious ban against financial institutions that intermediary in Bitcoin transactions and announced that it did not recognize Bitcoin as an official currency. Then, in September 2021, 10 government agencies, including the central bank and capital markets regulators, issued a sweeping ban covering all activities such as cryptocurrency transactions, mining, and initial token offerings (ICOs).
In February 2024, the Central Bank of China also banned the circulation of yuan-based stablecoins and unapproved tokenized assets released outside the country without permission.
Digital yuan attack and alternative approach to crypto
These restrictions indicate that China wants to promote digital yuan (CBDC), a state-backed digital currency, instead of cryptocurrencies. Recently, the Chinese government has introduced regulations that allow digital yuan to be made available to the public through banks and allow commercial banks to share interest on this currency.
Thanks to these steps, authorities aim to make digital yuan the main option for those who want to use traditional fiat money digitally. Cryptocurrency transactions are not expected to have similar freedom.
| Digital Yuan (CBDC) | Cryptocurrencies | |
|---|---|---|
| competent authority | People’s Bank of China (PBOC) | Decentralized; does not depend on any particular authority |
| legal status | Legal, government backed | Totally banned in China |
| Area of use | Local trade, public payments | Cannot be used because roaming is not allowed |
| Regulatory approach | State supported and encouraged | Comprehensive blocking and sanctions |
As a result, this new legal study initiated by the Supreme People’s Court of China paves the way for legal processes regarding cryptocurrencies and artificial intelligence-based technologies to become more open in the country. However, due to current bans and regulatory tightening, the cryptocurrency market is not expected to regain its former freedom in China in the short term.
