Regardless of the Chinese government banning all sorts of cryptocurrency transactions this past year, some firms apparently still use stablecoins like Tether (USDT) to pay for their workers.
Beijing’s Chaoyang District People’s Court has ruled that stablecoins like USDT can’t be employed for salary payments, the neighborhood news agency Beijing Daily reported on Wednesday.
China court mentioned that virtual currencies like USDT cannot circulate on the market like a currency, which requires all employers to simply pay their workers while using official currency, renminbi (RMB).
The ruling came included in a court situation involving an employee in a local blockchain firm suing his employer because of not saying yes to pay for his wages in RMB. The complaintant contended that rather of having to pay him in RMB, the firm had compensated his salary and bonuses within the USDT stablecoin.
Citing China’s blanket ban on crypto enforced in September 2021, a legal court noticed that digital currencies like USDT don’t have exactly the same legal status as legal tender. A legal court noted the plaintiff’s request to become compensated wages and bonuses by means of RMB fully matches local laws and regulations and also the court supports it.
As a result, a legal court purchased the defendants to pay for as many as greater than 270,000 RMB ($40,000) in wages, performance bonuses and annual bonuses owed towards the complaintant.
As formerly as reported by Cointelegraph, the People’s Bank of China formally announced some measures to battle against crypto adoption in China in September 2021. The experience involved 10 Chinese condition government bodies creating a brand new mechanism to avoid financial players from taking part in any cryptocurrency transactions.
Regardless of the ban, some local blockchain executives are tolerant of stablecoins like USDT. Yifan He, Chief executive officer of Red Date Technology — a tech firm active in the Blockchain Service Network (BSN), China’s major blockchain project — told Cointelegraph recently that stablecoins would work only when correctly controlled.
“USDC or USDT are payment-related currencies, not speculative assets. After they are fully controlled, they’re fine,” he stated.
Addressing the most recent news from China, He noted that all USDT transactions are illegal in China. However, banning such transactions might be too hard for regulators, the professional recommended. “There’s not a way to ban USDT payments technically in almost any country,” He stated. The expert also believes that USDT and it is major rival USD Gold coin (USDC) are “not popular whatsoever in China.”
Related: Circle’s USDC on the right track to topple Tether USDT because the top stablecoin in 2022
Tether USDT is really a major stablecoin pegged through the U.S. dollar on the 1:1 ratio, supported by U.S. dollars locked in U.S. treasury reserves, cash deposits along with other assets.
USDT may be the third-largest cryptocurrency after Bitcoin (BTC) and Ether (ETH) when it comes to market capital and it is the greatest digital asset when it comes to daily buying and selling volumes. During the time of writing, USDT’s daily buying and selling volumes stand at $57 billion, or 247% greater than the whole daily buying and selling volumes of Bitcoin.
