For the first time in Hong Kong’s history, the High Court ruled that digital currency should be regarded as property that can be held in trust.
The decision effectively equates cryptocurrency with other intangible assets like stocks and bonds. It was made in the liquidation of a lawsuit involving the now-defunct cryptocurrency exchange Gatecoin.
Law company Hogan Lovells announced the verdict earlier this week. According to the report, Gatecoin case judge Linda Chan concluded that digital currency “inherently” possesses all the characteristics of property.
Judge Chan is quoted by the report to have stated that “like other common law jurisdictions, our definition of ‘property’ is an inclusive one and intended to have a wide meaning.”
The most recent decision stands in stark contrast to the perpetual unclear state of cryptoassets in the United States. The U.S. Securities and Exchange Commission (SEC) differs from the Commodity Futures and Trading Commission (CFTC), which sees Bitcoin and Ether as commodities and deems the majority of crypto assets (apart from Bitcoin) as securities.
The Markets in Crypto Act (MiCA), the first complete regulatory framework for cryptocurrencies, was passed by EU parliamentarians on April 20. By making service providers liable for investor cash loss, the legislation hopes to lower risks for customers when they buy crypto assets. The MiCA also adds a number of regulations for transaction transparency, disclosure, authorization, and supervision for cryptocurrency platforms, token issuers, and traders.
