Ningxia court mediates virtual currency entrusted investment dispute; the judge indicates that relevant contracts after 2017 may be deemed invalid

ME News announcement: On April 1 (UTC+8), the Yinchuan Xingqing District People’s Court in Ningxia recently concluded a civil and commercial dispute arising from entrusted investment in virtual currency. In the case, the plaintiff entrusted funds to the defendant for investment in virtual currency. After failing to obtain repayment of the investment funds, the plaintiff brought the case to court on the grounds of “unjust enrichment.” After reviewing the matter, the presiding judge determined that this case in substance was a relationship under an entrustment (agency) contract. The judge clarified the litigation risks and the legal pros and cons to both parties, ultimately leading to the plaintiff withdrawing the lawsuit against some of the defendants. The remaining defendant returned the investment principal, and the case was successfully resolved through mediation. At the same time, the judge reminded that, according to the Supreme People’s Court’s judicial viewpoint, an entrusted investment contract signed after the central bank and seven other departments issued a virtual currency risk announcement on September 4, 2017, would be deemed invalid because the agency matters are unlawful. Investors should prudently assess the relevant legal risks. (Source: Foresight News)