•  As per the court, virtual currency does not have the same legal validity as national fiat currency.
• A virtual currency cannot be used as a currency in the market.
• hence a vehicle sale contract in which the parties agreed that the buyer would pay with privately produced digital money is void

Not legally protected

A Chinese court decided that a vehicle sale contract in which the parties agreed that the buyer would pay in virtual currency violated mandatory sections of laws and administrative rules and was thus unenforceable. A virtual currency, according to the court, “cannot be circulated in the market as [a] currency.”

According to one Chinese language publication, the Shanghai court issued its decision after a dissatisfied automobile buyer requested the court’s involvement. According to the report, in May 2019, a buyer only known as Huang signed a selling agreement with Shanghai Automobile Service Co Ltd.

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Huang agreed to buy an Audi sports car “with Yurimi as a monetary payment” as part of the deal. The seller was due to deliver the vehicle upon receipt of 1,281 units of the Yurimi virtual money, according to the agreement. Huang, however, sought restitution through the Shanghai Fengxian Court after the seller failed to deliver.

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Huang argued in court that Yurimi is a virtual commodity that can be exchanged for things, therefore it “does not violate the prohibitive provisions and should be valid.” Shanghai Automobile Service Co Ltd, on the other hand, contended that the selling agreement is an invalid contract and so should not be protected by law.