Shandong Court Hears Case on Losses from Entrusted Investment in Virtual Currency, Rules Plaintiff Bears Own Losses

Odaily News: The Zhangqiu District Court released a typical case. Liu entrusted his friend Zhang to invest in purchasing Alpha Coin. Shortly after the investment, the platform became inaccessible. Zhang informed Liu that the platform and its relevant responsible persons were suspected of criminal offenses and had been filed by the police, and the investment funds could not be refunded. Liu sued Zhang, demanding the return of the investment funds on the grounds of an entrusted contract. The court, after hearing the case, held that investing in virtual currency disrupts financial order and endangers financial security. The entrusted contract established by both parties for this purpose was an invalid contract. Zhang did not profit from the entrusted act. Liu's losses constituted investment risks faced when engaging in illegal financial activities and should not be protected by law. The court ruled to dismiss Liu's claim. The court pointed out that according to a notice issued by ten departments including the People's Bank of China, business activities related to virtual currency are illegal financial activities, and related civil legal acts are invalid. Losses arising therefrom shall be borne by the investors themselves.