China to establish rules for disposing of seized virtual currencies: reports

There is a growing need for regulations on how the Chinese government disposes of cryptocurrencies seized from illegal transactions. Lawyers say the lack of clear rules on how to handle cryptocurrencies such as Bitcoin (BTC), which are banned in mainland China, has led to inconsistent and unclear responses by local governments, raising concerns that they could encourage criminals and promote corruption. In response, judges, police and lawyers are debating amending rules to change how seized assets are treated.

According to court documents obtained by Reuters, local governments in China have seized cryptocurrencies through private companies to supplement their finances, which have been strained by the economic slowdown...