In recent years, the global cryptocurrency market has continued to heat up. Regions such as the United States and Hong Kong have successively introduced open policies, promoting the adoption of cryptocurrencies in broader financial applications. Meanwhile, blockchain technology has also been further explored domestically. Many financial institutions, traditional capital entities, and even some government units have gradually recognized cryptocurrencies as having asset attributes and investment value, no longer simply categorizing them as "shitcoins" or scams.

As stories of "getting rich by trading cryptocurrencies" spread, more people are attracted to trying their hand in the cryptocurrency trading arena. However, since the "924 Announcement" in 2021 explicitly defined virtual currency-related businesses as illegal financial activities, China has maintained a strict policy stance. Notably, in judicial practice, especially in civil trials in first-tier city courts, a more nuanced approach has emerged. Some courts have begun conditionally supporting civil claims involving virtual currencies, demonstrating a trend of "cautious acceptance" in the judiciary.

This article will analyze recent typical cases to outline the current judicial logic and reasoning of Chinese courts when handling virtual currency-related cases.

(Friendly reminder: China is not a case law country; court rulings are based on statutory law, but judicial practice may reference existing cases.)

1. Is Lending Valid? Borrowing USDT and Not Repaying? Court Ruling: Must Repay!
   In June 2024 and January 2025, Wen borrowed from Mao twice, amounting to 6,500 USDT and 14,400 RMB, respectively, for cryptocurrency trading. Mao agreed to lend the amounts and transferred them to Wen's USDT account. However, Wen failed to repay. After repeated unsuccessful attempts to collect the debt, Mao sued Wen based on the IOU. [Case No.: (2025) Zhe 0109 Min Chu 4938]
   The Xiaoshan District People's Court of Hangzhou ruled that the private lending relationship was legally valid and ordered Wen to repay the principal and interest in full. Notably, the court converted the 6,500 USDT to RMB at the exchange rate of 1:7.3 on the day of the loan, issuing an enforceable judgment.
   This ruling is seen as a significant breakthrough in recent judicial practice. It explicitly acknowledges the validity of lending relationships involving USDT and demonstrates fair adjudication based on facts, departing from earlier practices where some courts outright dismissed or refused to accept such cases.

2. Virtual Currency Already Delivered? Can the Buyer "Change Their Mind" and Request a Refund? Court: No!
   In earlier rulings, some courts deemed virtual currency transactions invalid for "violating public order and good morals," ordering the return of funds. Some payers who had already completed transactions thus attempted to sue for refunds under claims such as lending or fraud. However, with improved judicial understanding, many courts have accumulated knowledge about blockchain technology. Some, like Shenzhen courts, have even introduced "blockchain evidence verification" services. Such "regret-based claims" are increasingly unlikely to succeed.
   Case 1: (2025) Yu 9001 Min Chu 3862
   Zheng transferred 10,000 RMB to Zhao, claiming it was a loan and demanding repayment. Zhao argued that it was partial payment for purchasing USDT and presented evidence such as chat records proving that 2,100 USDT had been delivered via the "Yi Shengtai Platform." The court found Zheng's evidence insufficient and ruled that the lending relationship did not exist. As virtual currency transactions are not protected by law, related losses are to be borne by the parties themselves.
   Case 2: (2024) Zhe 0122 Min Chu 4242
   Wang entrusted Li to purchase USDT, transferring 760,000 RMB. Later, Wang claimed not to have received the coins and that platform data had been tampered with, demanding a refund. The court found that Li had indeed transferred the funds to a third party to purchase the coins, and Wang failed to prove fraud. The court ultimately ruled that the entrustment contract was invalid due to policy violations but dismissed Wang's refund request, as he failed to prove fault or non-delivery by the other party.
   These two cases show that once a transaction is genuinely completed, whether through direct trading or entrustment, courts generally do not support buyers' attempts to reclaim funds under various claims afterward.

3. Under What Circumstances Will Courts Still Order Refunds or Compensation?
   Although "bear your own risk" is the basic principle, courts may still order refunds or even award compensation in certain special circumstances:
   Case 1: Guaranteed Principal Promises Incur Liability [(2025) Zhe 0127 Min Chu 331]
   Wang induced another party to invest in USDT by promising high returns and repeatedly issued "Guarantee Letters"承诺赔付本金. After the exchange shut down, the investor lost over a million yuan. The court ruled the contract invalid but found Wang's principal guarantee constituted fault, ultimately ordering him to bear 60% of the principal compensation responsibility.
   Case 2: Non-Delivery of Currency Warrants Refund [(2025) Yue 0104 Min Chu 16716]
   Xu transferred 10,000 RMB to He, who claimed it was for purchasing CG coins for sports betting但未交付幣且平臺失聯. The court deemed the virtual currency transaction illegal but ruled that the defendant failed to prove delivery, thus ordering the refund of the transferred amount.
   Case 3: Post-Transaction Repayment Promise Valid [(2024) Zhe 0502 Min Chu 3012]
   Shen introduced Yi to convert RMB through a USDT channel, but the intermediary absconded with the funds. Later, Shen promised in writing to repay 160,000 RMB in installments. The court ruled the original agency contract invalid but upheld the subsequent repayment promise as independently valid.

4. Summary and Outlook
   From the judicial practice in 2025, Chinese courts are cautiously seeking a balance between policy compliance and practical dispute resolution, showing the following trends:

5. If a virtual currency transaction has been completed, courts generally dismiss buyers' requests for refunds.

   • If one party fails to deliver the currency or fulfill the contract as agreed, courts may support refunds.

   • If there are fault-based actions such as inducing investment or promising principal guarantees, courts may order corresponding liability based on the fairness principle of the Civil Code.
     Although broader policies remain restrictive, the judicial system is gradually improving its ability to identify the facts of virtual currency transactions, with rulings becoming more nuanced and fair. Ordinary users must remain aware of the legal risks of virtual currency trading. If participating, they should clarify transaction details and responsibility divisions through written agreements, chat records, etc., to safeguard their rights in disputes.