Author: Liu Zhengyao

Introduction

In recent years, with the development of blockchain technology, cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), and Tether (USDT) have become increasingly well-known to the public. Although these assets are represented as "code" and "data," their inherent value, transferability, and exclusivity endow them with property attributes. In China, according to the "9.4 Announcement" in 2017 and the "9.24 Notice" in 2021, it is explicitly prohibited for virtual currencies to circulate and be used as legal tender; speculation on virtual currencies is also clearly banned. However, in judicial practice, virtual currencies have been widely recognized as "specific virtual goods" or "data-based property."

In the field of criminal justice, the number of cases involving virtual currencies as objects or tools of crime has been increasing year by year, with the most common types being fraud, theft, and computer-related crimes. However, cases of "robbery" attempting to obtain virtual currencies through direct violence or coercion are relatively rare (extortion crimes involving cryptocurrencies are more common). Therefore, the 2021 case of Lai and Xiang robbing Bitcoin in Yichun, Jiangxi (Case No. (2022) Gan 09 Criminal Final 9), due to its special circumstances, complex classification, and strong controversy, has become a typical example in judicial practice and provides a good reference for how to classify and sentence cryptocurrency assets in criminal cases.

1. Case Introduction: From "Recruiting People on Tieba" to Arrested in a Hotel, a Foiled Bitcoin Robbery Plan

According to the information disclosed in the court judgment, the case originated from Lai's losses in cryptocurrency trading. In May 2021, Lai learned that Teacher Peng held at least 5 Bitcoins (then priced at about 255,000 RMB each) and conceived the idea of "getting some coins" through robbery. Concerned that he could not control the situation alone, Lai chose to post on Baidu Tieba to recruit "heroes" for the plan.

After seeing the information, Xiang proactively contacted Lai, and the two communicated privately via the "Bats" chat software. Lai detailed his robbery plan and promised to give Xiang 0.8 Bitcoins if successful. Xiang then took a high-speed train from Changsha to Yichun, met Lai, and checked into a hotel. The two formulated a detailed plan in the room, intending to gather at least 4 people, with Lai inviting Teacher Peng to a remote area under the pretext of "investment," one person driving, and the other three using nylon ties to control Peng and his companions, then demanding the Bitcoin account and password.

To prepare for the robbery, Lai even picked up 7 nylon ties near the hotel. He also continuously contacted netizens with robbery intentions, such as "Magic Cube," "Mixed River Dragon," and "Peach," trying to gather enough people to commit the crime. However, before the accomplices could arrive, the police had already locked onto their location based on clues and arrested the two on the afternoon of May 11, before the criminal plan could be executed.

The first-instance court found that the two constituted robbery and sentenced Lai to three years and Xiang to one year in prison, along with fines. However, both appealed. The second-instance court determined that the case was in the preparatory stage of robbery, which did not result in actual property loss and did not make a reasonable determination of the value of Bitcoin, thus reducing Lai's sentence to one year and six months and Xiang's to nine months, significantly shortening the prison terms.

2. Does Robbing Bitcoin Constitute Robbery?

An important point of contention in this case is whether robbing Bitcoin can constitute "robbery" under the Criminal Law.

The court's effective judgment clearly answered this question—yes, it constitutes robbery.

Robbery under the Criminal Law refers to the act of seizing public or private property through violence, coercion, or other means. Although Bitcoin is essentially a string of encrypted data based on blockchain technology, it possesses exchangeability, transferability, and real market value, meeting the three major characteristics of "broadly defined property": manageability, transferability, and value.

The Yichun Intermediate Court (the second-instance court) cited the "Notice on Preventing Bitcoin Risks" issued by the central bank and other departments in 2013, stating that Bitcoin is a "specific virtual commodity." Although it does not have the status of currency, it still belongs to "data-based property" that should be legally protected. Therefore, robbing Bitcoin does not lose the elements of property crime simply because its form is data; the object of infringement remains the property interests of others, which is fundamentally no different from robbing cash or mobile phones.

In this case, although Lai and others did not begin to implement the robbery, their actions constituted criminal preparation, as the two defendants had prepared ties and formulated a detailed robbery plan, constituting a preparatory offense for robbery under the Criminal Law. In conjunction with the Supreme People's Court's "Guiding Opinions on Several Issues Concerning the Application of Law in the Trial of Robbery Cases," the court ultimately determined that their actions constituted robbery but reduced the punishment.

3. Sentencing Rules for Crimes Involving Virtual Currencies: The Key Lies in the Determination of "Property Value"

In sentencing for robbery, in addition to the method of conduct, the "amount of robbery" must also be considered, and how to value the robbery of encrypted assets is one of the difficulties in judicial practice.

The first-instance court based its judgment on the immediate market price of Bitcoin at the time of the incident (approximately 255,000 RMB per coin), believing that the two intended to rob at least one coin, thus constituting "particularly large amounts," leading to a heavier sentence. However, the second-instance court argued that: first, the case had not entered the "execution stage," and no property had been actually obtained; second, there is no legal trading market for Bitcoin in China, and price determination lacks clear standards; third, the conviction for robbery should be based on the "actual amount obtained," and the value cannot be accurately defined in the preparatory stage of the robbery.

The second-instance court pointed out that the value of virtual currencies and other encrypted assets should follow the "loss compensation" principle, namely: the actual loss of the victim as the core basis, mainly referencing the following factors:

(1) The purchase price of the victim: This should be prioritized as it most accurately reflects their loss.

(2) The price on the trading platform at the time of the incident: If there is no purchase record, the immediate price on foreign platforms at the time of infringement can be referenced.

(3) The price of reselling: If available, this can also serve as auxiliary evidence.

At the same time, the court emphasized that although China does not recognize Bitcoin as having currency status, it has not prohibited private ownership and transfer. Therefore, the victim's ownership of virtual assets is legal, and their losses should be protected by law.

Ultimately, the second-instance court decided not to impose a heavier penalty based on the "large amount" of robbery but instead made a relatively lenient judgment for the two defendants, considering the harmfulness, means, and real risks of the preparatory stage of robbery, which also reflects the rationality and prudence of judicial authorities in new property crime cases.

4. Conclusion: The Future Landscape of Legal Protection for Crypto Assets

The judgment in this case not only provides exemplary guidance for robbery cases involving virtual currencies but also sends a clear signal: the property attributes of virtual currencies have been widely recognized in Chinese criminal law practice.

Under the current legal framework, although Bitcoin and other encrypted assets do not possess currency attributes, they have significant property value. Whether through fraud, theft, illegal control of computer systems, extortion, or violent robbery, as long as the perpetrator commits an act of infringement with the intent of illegal possession, their actions will be treated as property crimes.

As the digital economy continues to develop, criminal cases involving encrypted assets will become increasingly diverse, and judicial authorities will face more new types and new disputes. Future laws should further clarify the legal attributes of virtual currencies, market valuation standards, and the delineation between data and property, establishing more unified and stable judicial adjudication rules. Of course, web3 lawyers also need to engage in more professional learning beyond legal knowledge about encryption to better serve their clients.

It is foreseeable that encrypted assets will increasingly gain legal recognition and protection, and any actions infringing on the legitimate rights and interests of their holders will be severely pursued under the law.

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