Can the virtual currency be enforced after winning the lawsuit? ——Return the currency and successfully execute the case

Source: Rhythm Currency Circle

Abstract

In the past three years, virtual currency civil cases have rarely been supported by the courts, and the plaintiffs’ lawsuits have mostly been dismissed. Request ends. However, although the civil contract of virtual currency is invalid, it does not affect the return of property after the invalidity, so many people have misunderstandings about this, including many case handling units. However, compared to "whether virtual currency is protected by the court," whether virtual currency as property can be enforced by the court is more difficult. The key points are: Firstly, virtual currency is not like bank account funds that can be seized and frozen by the court; secondly, virtual currency is difficult for the court to evaluate and recognize its value.

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Case Introduction 

Li (pseudonym) ) is a senior executive of a company in Guangdong. He met Wang (pseudonym) because of work, and the two became friends. Because Wang has more experience in investing in virtual currencies, the two agreed that Li would contribute the capital, and Wang would help him handle the investment matters. Li could withdraw the virtual coins managed by Wang at any time.

On December 3, 2020, Li paid about 1 million yuan to Wang, entrusting Wang to help purchase and manage the virtual currency ETH, and store the imToken digital wallet of ETH. Wang was informed of his address and private key, and both parties agreed that Wang must first obtain Li’s authorization to dispose of the ETH. However, Wang secretly transferred the ETH that Li had entrusted him to manage to his own wallet and sold it. As a result, when Li asked Wang to help him withdraw the ETH, Wang could not complete the previous agreement.Li missed reached the peak of ETH and lost a lot of money.

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Case handling process 

1. Agency contract Dispute litigation and obtained a winning judgment

After the incident, Li has been suffering from the lack of reasonable channels to protect his rights. Once he passed The Internet learned about Liu Lei’s legal team. After full consultation with Liu Lu, they felt that our team was very professional in handling virtual currency cases, and decided to entrust our team to intervene in the case. After fully evaluating the case, Liu Lu organized a team of lawyers to collate relevant evidence materials and filed the case with a district court in Guangzhou where the defendant was located. After the case was filed, the team's lawyers conducted legal arguments from multiple perspectives such as the validity of the contract, entrustment authority, and the property attributes of the virtual currency, and requested the court to order Wang to return Li's ETH and compensate for losses. From the filing of the case to the hearing, the lawyer communicated with the case handlers many times and submitted legal opinions. During the communication process, the presiding judge recognized many of our team’s views.

In February 2022, the court of first instance made a judgment:Confirming that the contract was invalid, both parties shall bear liability according to their faults, and affirmed the legal role of lawyers from Liu Lu’s team in the defendant Wang’s private disposal of the subject matter of the entrustment. Based on fault and other viewpoints, Wang was sentenced to return approximately 323 ether coins to Li.

Wang is not convinced An appeal was filed. The court of second instance believed that the facts found by the court of first instance were clear and the handling was not inappropriate. In July 2022, it ruled to reject the appeal and uphold the original judgment. This case is also the first case in the country to return the virtual currency ETH since the "924 Notice".

2. Execution The stage was blocked and the execution of the ruling was terminated

After receiving the effective winning judgment, Liu Lei’s legal team immediately actively coordinated with the court However, due to the particularity of the execution subject of this case, the court encountered difficulties in execution when executing based on the effective judgment. In the end, the court held that the ETH involved in the case was a specific subject matter and could not be executed because it had been lost. Since the two parties did not reach an agreement on discount compensation, the court ruled to terminate the execution in February 2023.

3. Bring up property damage compensation again Litigation and execution are finally in place

After the execution of the case, in order to safeguard the legitimate rights and interests of the clients, Lawyer Liu Lu’s team Zhan Qing On the grounds of property damage compensation, a new lawsuit was filed, requesting an order to order Wang to compensate Li by converting the unpaid ETH into RMB. The case was accepted by the court in May 2023. During the litigation process, Lawyer Zhan applied to seize the property in the defendant's name in accordance with the law, compiled new legal opinions based on the circumstances of the case, and participated in the court session. The defendant requested the court to dismiss the prosecution on the grounds of repeated prosecution.

When communicating with the judge, Team Zhan’s lawyer said: Even if the current law prohibits virtual currency transactions, the fact that Wang made a profit from the ETH that Li entrusted him to manage cannot be denied, so in When the defendant is unable to return the original property in full, the plaintiff's claim for economic losses in cash is well-founded in law. After hearing the case, the court held that the specific subject matter of this case, ETH, was indeed lost and unenforceable, but the plaintiff has not yet received substantial compensation for its losses. Therefore, the plaintiff filed a lawsuit based on new facts, which did not constitute a repeated lawsuit, and the defendant's request to dismiss the lawsuit was not accepted. In addition, the court also recognized the view of Liu Lu’s team of lawyers on discounted compensation.

In the end, taking into account the overall case facts and the fact that Wang had previously paid part of the money to Li, in November 2023,the court ruled that Wang would compensate the remaining virtual coins that needed to be returned at a discount. After the judgment came into effect, Li has received the first discount payment through active coordination and communication with lawyers.

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The lawyer has something to say

< strong>This case is the first case supporting the return of Ethereum after the issuance of the "924 Notice", and is of great significance to the development of judicial practices related to virtual currency transactions. In this case, our team obtained a winning judgment for the client. Although it was stuck on the implementation issue, through the unremitting efforts of the team, we again filed a new lawsuit for property damage compensation disputes. After many twists and turns, we finally helped the client. Protected one's legitimate rights and interests. Liu Lei's legal team also reminds you: When encountering relevant problems, you must entrust a professional lawyer to intervene as soon as possible to maximize your legal rights.