Exploring New Models for the Disposal of Involved Virtual Money: Collaboration between Beijing Police and Property Exchange Attracts Attention

Recently, the Beijing Municipal Public Security Bureau's Legal Affairs Team announced a new measure for the disposal of involved Virtual Money, sparking widespread discussion within the industry. This measure involves the cooperation between the Beijing Municipal Public Security Bureau and the Beijing Property Exchange, aiming to establish a new channel for the disposal of Virtual Money. However, from a professional perspective, this disposal model is not truly innovative, nor does it represent a fundamental shift in national policy towards Virtual Money trading.

Disposal Mode Analysis

According to public information, the Beijing Public Security Bureau has signed a cooperation agreement with the Beijing Property Exchange to establish a new model for the disposal of involved Virtual Money. The specific process is as follows:

1. The Beijing Public Security Bureau will entrust the virtual money involved in the case to the property exchange for disposal.
2. The property exchange selects a third-party institution for technical operations, converting Virtual Money into cash through a compliant trading platform in Hong Kong.
3. After approval by the foreign exchange management department, the realized funds will be converted and transferred to a special account of the public security organ.

This model has been applied in a case at the Shunyi Branch of the Beijing Public Security Bureau.

Evolution of Disposal Modes

From a professional perspective, the judicial handling of Virtual Money in mainland China has roughly gone through three stages:

1. Disposal Period 1.0 (2018-2021): Mainly realized through over-the-counter trading and other methods, which involves compliance risks.

2. Disposal 2.0 Period (2021-2023): Affected by policies, disposal activities have shifted overseas, but there are compliance issues with foreign exchange.

3. Disposal Period 3.0 (from the end of 2023 to present): A joint disposal model both domestically and internationally is adopted, completing monetization and capital return through compliant channels.

The cooperation model between the Beijing Municipal Public Security Bureau and the property exchange is actually a practice belonging to the disposal 3.0 stage, which is not the first of its kind in the country.

Questions about Disposal Mode

Although this model has received official recognition, there are still some issues worth following:

1. The role of the property exchange: it is essentially an intermediary, rather than a direct executor of disposals.

2. Margin Requirement: The requirement for a 110% margin ratio is relatively high and may affect disposal efficiency.

3. Disposal Fee Issue: The reserve price rule for public auctions may not be fully applicable to the disposal of Virtual Money.

Policy Outlook

Although this cooperation has sparked some speculation about policy easing, from a professional perspective, it does not mean that the country will loosen its restrictions on Virtual Money trading in the short term. It is expected that in the next two to three years, mainland China will maintain a strict regulatory attitude towards Virtual Money trading and will not fully open it up for ordinary citizens to participate in Virtual Money trading.

Overall, this initiative by the Beijing Municipal Public Security Bureau reflects the exploration and progress of judicial authorities in handling cases involving Virtual Money, but it does not represent a fundamental shift in regulatory policy. The judicial disposal of Virtual Money has been ongoing, only the methods of disposal are continuously being optimized and standardized.