Foresight News reports that the Justice Network, supervised by the Supreme Procuratorate and hosted by the Procuratorial Daily, published an article yesterday titled (Establishing Multiple Judicial Disposal Paths for Criminal Cases Involving Virtual Currencies). The article pointed out that the improvement of the judicial disposal path for virtual currencies involved in criminal cases should include the following four points:
First, clarify the legal status and role positioning of third-party institutions. Future legislation may include third-party institutions in the category of judicial auction assistants, granting them exclusive qualifications for 'one-time, targeted, non-public bidding.'
Second, establish a dual system of technical standards and procedural norms. To ensure the compliance and transparency of the disposal process, technical and procedural dual standards should be jointly issued by the Supreme Court, the Supreme Procuratorate, and financial regulatory authorities. In terms of technical standards, the qualification requirements for bidding platforms can be clearly defined, including blockchain technology capabilities, data security guarantees, etc.; in terms of procedural standards, the price assessment methods can be standardized, using the average price of the 20 days prior to the transaction date or the cost incurred by the victim as the benchmark, unifying the on-chain evidence format, and directly transferring the proceeds to a special financial account to eliminate the channels for fund return and cryptocurrency speculation.
Third, strengthen the full-link connection of prosecutorial supervision and rights protection. The procuratorial organs may require third-party institutions to regularly submit disposal progress reports, including on-chain tracking records, bidding processes, and fund transfer vouchers; at the same time, a rights notification and objection mechanism may be established to ensure that involved parties and well-meaning third parties can timely understand the disposal situation and raise objections. For objections, expert discussions may be organized or independent institutions may be entrusted to review, ensuring the fairness of the disposal results.
Fourth, explore differentiated disposal models. Differentiated measures applicable for realization, destruction, and return are three disposal measures. In cases involving the return of victims' property, the directed bidding realization model may be prioritized to ensure that the realization amount is fully compensated. For instance, if a victim has not exchanged stablecoins after being defrauded and is willing to return the original currency, it can be directly returned under compliant conditions to avoid exchange rate losses. For cases involving the confiscation of prohibited items, destruction or technical sealing modes may be used to prevent re-entry into the market. For example, tokens specifically used for pyramid schemes or gambling, if they have poor liquidity and insufficient market depth, forced realization may lead to depreciation, and they may be legally destroyed with destruction records documented in the ruling documents. For criminal proceeds that have been mixed with legitimate investments in high-value cryptocurrencies, realization should be prioritized to maximize loss recovery. Additionally, for cases involving smaller amounts or where technical tracking is more challenging, simplified disposal procedures may be explored, such as a comprehensive identification model, which means assessing the value and ownership of the involved virtual currency based on relevant evidence when the complete flow path cannot be fully clarified.