A court has ruled that NFTs and digital collectibles should have the same protection as physical property under Chinese law.
Recently, it was reported that the Chinese Court recognized in NFT the property's characteristics, such as value, scarcity, alienability, and saleability.
NFTs, or "non-interchangeable tokens," attracted the attention of the crypto industry and even the mainstream media during its rapid growth and boom in popularity in 2021. For most of 2022, however, prices and trading volumes for these digital collectibles collapsed.
Although, as BeInCrypto reports, trading volumes at leading NFT collections rose in November 2022, despite the cryptocurrency market turmoil caused by the fall of FTX.
"The contract in question does not violate Chinese laws and regulations, does not contradict the realistic policy and regulatory orientation of China's economic and financial risk of national defense, and should be protected by Chinese law.", to the text of the court itself
The announcement follows a recent court case in Hangzhou involving a dispute over ownership rights between an NFT platform and a user.
The difficulty in regulating this sector is that there are many fraudsters and unscrupulous participants. In April of this year, a court in the Chinese city of Hangzhou in the east of the country issued the first landmark ruling in a case involving NFT.
According to this ruling, marketplaces should be held liable for users who create NFTs from stolen artwork.