In a landmark ruling, the Haidian District People's Court in Beijing has concluded the first legal case in its jurisdiction involving a dispute over Bitcoin Cash (BCC) stemming from a blockchain fork. The court ordered Beijing Lekuda Network Technology Co., Ltd.—the operator of the former OKCoin China platform—to credit 38.7480 Bitcoin Cash (BCC) to the plaintiff’s account, while rejecting claims for financial compensation tied to the cryptocurrency’s market value.
This decision marks a significant precedent in China’s evolving stance on digital assets, affirming that virtual currencies can constitute protected civil interests under contract law, even as regulatory policies restrict their use in financial transactions.
Background of the Bitcoin Fork and User Claim
The case centers around Mr. Feng, who purchased 38.748 Bitcoin (BTC) on the OKCoin China platform (operated by Lekuda) prior to August 2017. At that time, the Bitcoin network underwent a major split—commonly known as a "hard fork"—which led to the creation of a new cryptocurrency: Bitcoin Cash (BCC).
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In anticipation of this event, Lekuda issued a series of public announcements outlining its policy for handling the fork:
- On July 18, 2017, the company stated it would distribute any newly split cryptocurrencies to users based on ownership rights.
- On July 25, 2017, it confirmed that users holding BTC before August 1, 2017, at 20:20 Beijing time would receive an equal amount of BCC.
- On August 1, 2017, a final notice clarified that a snapshot of user balances would be taken at that exact moment, and eligible BCC would be credited to users’ OKEx spot accounts.
Mr. Feng had maintained a balance of exactly 38.7480 BTC from January 12, 2017, until he withdrew all funds on November 27, 2017—well after the snapshot date. Despite meeting the stated conditions, he found the “claim” button missing when attempting to retrieve his BCC and received no response after repeated attempts to contact customer support.
Court Ruling: Recognition of Digital Asset Rights
The court determined that although Bitcoin and other virtual currencies are not legal tender in China, they are recognized as legitimate objects of online transactions and possess civil interest protected under contract law.
Key findings included:
- The service announcements published by Lekuda constituted binding terms between the platform and its users.
- Mr. Feng met all eligibility criteria: he held BTC before the critical snapshot time and maintained his balance without withdrawal during the relevant period.
- Therefore, Lekuda was obligated to deliver 38.7480 BCC as promised.
However, the court dismissed Mr. Feng’s request for over 160,000 RMB in damages due to the appreciated market value of BCC. It ruled that such compensation lacked legal basis, given China’s prohibition on treating cryptocurrencies as financial instruments or pricing them against fiat currency.
Legal Status of Cryptocurrencies in China
While individuals may legally hold cryptocurrencies in China, strict regulations govern their usage:
- The People’s Bank of China (PBOC) and other regulators have repeatedly emphasized that Bitcoin does not have legal tender status.
- Financial institutions and payment companies are banned from offering services related to cryptocurrency trading or exchange.
- Token financing platforms cannot facilitate direct conversion between fiat money and digital tokens.
- No entity may provide pricing or intermediary services for virtual currencies.
These policies were reinforced in official notices issued in December 2013 and September 2017, reflecting ongoing concerns about financial stability, money laundering, and speculative risks.
Despite these restrictions, courts are increasingly recognizing that user rights tied to digital assets—such as entitlements from forks or airdrops—can be enforceable if clearly promised by service providers.
Core Keywords and SEO Optimization
This case highlights several essential concepts relevant to blockchain users and digital asset holders:
- Bitcoin Cash dispute
- Blockchain fork
- Cryptocurrency legal rights
- Virtual asset protection
- OKCoin China
- Bitcoin snapshot
- Digital currency ownership
- Cryptocurrency claim process
These keywords reflect common search intents among users seeking clarity on recovering forked coins, understanding platform responsibilities, or exploring legal precedents in crypto-related disputes.
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Frequently Asked Questions (FAQ)
Q: What is a blockchain fork?
A: A blockchain fork occurs when a cryptocurrency’s protocol splits into two versions. In a hard fork like Bitcoin Cash, a new coin is created, and users who held the original asset (BTC) may be entitled to receive the new one (BCC) based on platform policies.
Q: Can I sue a crypto exchange for not delivering forked coins?
A: Yes—if the exchange made a clear public commitment (e.g., through official announcements), courts may view this as part of the contractual relationship. This case sets a precedent showing that failure to deliver promised assets can result in legal liability.
Q: Are cryptocurrencies protected by law in China?
A: While trading and financial use are restricted, courts recognize digital assets as having civil value. Ownership and contractual rights related to crypto holdings can be legally enforced, even if full financial regulation does not apply.
Q: Why was the price loss claim denied?
A: Because Chinese regulations prohibit treating cryptocurrencies as investment products or valuing them against RMB in legal claims. The court could enforce delivery of the asset but not award monetary damages based on its fluctuating market price.
Q: How do I know if I’m eligible for forked coins?
A: Check whether you held the original cryptocurrency on a supported exchange before the snapshot date. Review official announcements from the platform regarding distribution rules and timelines.
Final Judgment and Industry Implications
The court’s decision underscores an important principle: platform transparency and accountability matter. Even in a tightly regulated environment like China’s, companies must honor their commitments to users when managing blockchain events such as forks.
For cryptocurrency users globally, this case serves as a reminder to:
- Monitor official announcements from exchanges during network upgrades.
- Keep records of balances and transaction history around key dates.
- Understand how different platforms handle forks, airdrops, and token distributions.
As decentralized technologies evolve, so too will legal interpretations of digital ownership. Cases like this help define the boundaries between innovation, corporate responsibility, and user rights.
👉 Stay updated on blockchain developments and secure your crypto future today
Conclusion
The Haidian Court’s ruling in this pioneering Bitcoin Cash dispute affirms that digital assets carry enforceable civil rights—even within restrictive regulatory frameworks. While China continues to ban cryptocurrency trading and financialization, it acknowledges user entitlements derived from transparent platform policies.
For investors and enthusiasts alike, this case reinforces the importance of due diligence, record-keeping, and understanding how blockchain mechanics intersect with legal protections. As more jurisdictions grapple with similar questions, this judgment may influence how courts worldwide treat virtual asset disputes moving forward.