Chinese court invalidates 2019 car sale made using now worthless crypto token

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Last week, a WeChat post published by the Shanghai Fengxian Court started circulating in crypto circles regarding its recent ruling on car sales in May 2019 using the digital currency. At the time, the buyer, identified only as Mr. Huang, entered into a sales contract with an undisclosed car dealership in Shanghai to purchase a 2019 Audi AL6 for CNY 409,800 ($59.477) in exchange for 1,281 UniHash (UNIH) tokens. Signed. According to the original contract, the seller was to deliver the car to Huang within three months.

According to the Shanghai Fengxian Court, Mr. Huang paid UNIH 1,281 on the date of signing the contract, but did not receive the car within the specified period nor later. As a result, Mr. Huang took the seller to court, demanding delivery of the vehicle and payment of daily interest of 0.66% of the transaction amount, for every day that the car went beyond the original deadline.

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The case took three years before the verdict came out this June. Citing regulations in September 2017, now known as China’s cryptocurrency ban, the Shanghai Fengxian Court held that digital assets “cannot and should not be used as currency for circulation in markets”. should” and the use of digital tokens such as UNIH in exchange for fiat money as consideration in everyday contracts was a violation of the relevant regulation that overrides such contracts themselves. Therefore, the sale contract was held to be void and void. Neither the buyer was awarded damages, nor the delivery of the car, nor the return of his 1,281 UNIH.

It is not clear how the seller agreed to the conversion rate of 1 UNIH = CNY 320 as set out in the original contract. Unihash was supposedly a digital payment token developed for e-commerce in 2018 and was only available to private investors, with no public initial coin. Shortly after its launch, accusations quickly surfaced on Chinese social media, which labeled the project a “scam” and stated that its token metrics, as well as the company’s history, were allegedly extended to lure investors. – was presented.

Currently, the project appears to be abandoned due to no link with the social, no market listing, and no further development activity. Furthermore, the firm behind UNIH did not meet any of its goals listed in its original whitepaper. One such promise made to investors in the document included: “What can be certain is that the UniHash token may appear on multiple exchanges by the fourth quarter of 2019.