Yinchuan court mediates a virtual currency entrusted investment dispute, warning that contracts after 2017 may be deemed invalid

Gate News message. On April 1, the Yinchuan Xingqing District People’s Court recently concluded a civil and commercial dispute arising from a delegated investment in virtual currency. In the case, the plaintiff entrusted funds to the defendant for virtual currency investment. After failing to obtain the return of the investment funds, the plaintiff filed a lawsuit in court, claiming “unjust enrichment.” After reviewing the case, the presiding judge determined that the matter is actually a relationship under a委托 contract, and explained to both parties the litigation risks and the legal pros and cons. Ultimately, this led the plaintiff to withdraw the lawsuit against some of the defendants, with the other defendant returning the original investment principal. The case was resolved through mediation. The judge also reminded that, according to the Supreme People’s Court’s judicial views, after September 4, 2017, when the People’s Bank of China and seven other departments issued a risk announcement regarding virtual currencies, delegated investment contracts signed thereafter would be deemed invalid because the agency matters are illegal. Investors should carefully assess the relevant legal risks.